An effective quota system does not:
A)increase quantity demanded.
B)decrease quantity supplied.
C)create economic rent.
D)produce a dead weight loss.

Question

Quizplus · Accepted Answer

An effective quota system typically limits the quantity supplied, which can lead to a decrease in quantity supplied, create economic rent, and produce a dead weight loss. However, it does not increase quantity demanded; instead, it restricts supply, which can lead to higher prices and reduced demand.

An Effective Quota System Does Not