By restricting the amount of a good that may be imported, quotas:
a. increase the price, thus causing domestic producers to sell less than they would with free trade.
b. lower the price, thus allowing domestic producers to sell more than they would with free trade.
c. increase the price and allow domestic producers to sell more at a higher price than they would with free trade.
d. lower the price, thus causing domestic producers to realize lower total revenue from the quota item.
e. simply replace foreign production with domestic production.
c
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Make a case that development economics might be merely a combination of all the other subfields of economics, only applied to low-income countries
What will be an ideal response?
An increase in the demand for lobster due to changes in consumer tastes, accompanied by a decrease in the supply of lobster as a result bad weather reducing the number of fishermen trapping lobster, will result in
A) a decrease in the equilibrium quantity of lobster and no change in the equilibrium price. B) an increase in the equilibrium price of lobster and no change in the equilibrium quantity. C) an increase in the equilibrium price of lobster; the equilibrium quantity may increase or decrease. D) a decrease in the equilibrium quantity of lobster; the equilibrium price may increase or decrease.
Trade allows the people of a country to produce outside their production possibility curve.
Answer the following statement true (T) or false (F)
In which of the following countries did exports account for the biggest percent of GDP in 2011?
A. Japan B. United States C. Netherlands D. Germany