Question

2- When a government restricts the quantity of a good that can be imported into a...

2- When a government restricts the quantity of a good that can be imported into a country, it is imposing: A. Import Quota B. Voluntary Export Quota C. Export Quota D. Voluntary Import Quota

Homework Answers

Answer #1

Since import tariff is imposed on the imported goods by the importing country government and tariff leads to an increase in the price of imported goods. The importing country government receive import tariff revenue. Since effect of import quota and tariff are same. So imported price will increase same as it happens in the case of tariff. The importing country government receive import tariff revenue.

Hence it can be said that when a government restricts the quantity of a good that can be imported into a country, it is imposing import quota.

Hence option A is the correct answer.

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