If a country removed an import quota on cotton,then overall that country's
A)exports and imports would rise.
B)exports would rise and imports would fall.
C)exports would fall and imports would rise.
D)exports and imports would fall.

Question

Quizplus · Accepted Answer

By removing the import quota on cotton, the supply of cotton in that country would increase, which would lead to a decrease in price. This would make cotton products produced in that country more expensive in comparison, leading to a rise in exports. Additionally, the increase in supply would lead to more imports of cotton, thus increasing overall import levels. Therefore, both exports and imports would rise.

If a Country Removed an Import Quota on Cotton,then Overall