Which of the following statements is true of import quotas?
A) They are the most straightforward denial of absolute or comparative advantage.
B) They are government payments to domestic firms.
C) They are rules stipulating that a certain proportion of the value of the goods made in one country must originate from that country.
D) They are bureaucratic rules that make it harder to import foreign goods.

Question

Quizplus · Accepted Answer

Import quotas are limits on the quantity of a good that can be imported, directly restricting trade and denying the benefits of absolute or comparative advantage by limiting the amount of goods that can be imported regardless of their efficiency or cost-effectiveness.

Which of the Following Statements Is True of Import Quotas