Which of the following is true?
A) An import quota generates government revenue.
B) Tariffs on imports generate government revenue as long as the domestic price is larger than the world price plus the tariff.
C) Tariffs on imports do not generate government revenue if the domestic price is larger than the world price plus the tariff.
D) Tariffs on imports never generate government revenue.

Question

Quizplus · Accepted Answer

Tariffs on imports generate government revenue through the taxes collected on imported goods. This occurs when the domestic price of the goods, after adding the tariff, is still competitive, encouraging imports despite the additional cost.

Which of the Following Is True