Compared to a tariff, an import quota, which restricts imports to the same amount as the tariff, will leave the country as a whole:
A) worse off than a comparable tariff.
B) not as bad off as a comparable tariff.
C) about the same as a comparable tariff.
D) Any of the above can be true.

Question

Quizplus · Accepted Answer

An import quota can be worse than a tariff because it does not generate revenue for the government and can lead to inefficiencies and higher prices due to limited competition.

Compared to a Tariff, an Import Quota, Which Restricts Imports