A policy that has the effect of reducing the quantity supplied and raising price is said to be a
A)quota.
B)product guilty of dumping.
C)tariff.
D)countervailing duty.

Question

Quizplus · Accepted Answer

A quota is a policy that limits the amount of a product that can be imported into a country. This restricts the quantity supplied, which can cause prices to rise. Therefore, a policy that involves a quota will have the effect of reducing the quantity supplied and raising price. The other policy options listed (product guilty of dumping, tariff, countervailing duty) do not necessarily have this effect.

A Policy That Has the Effect of Reducing the Quantity