When import quotas are imposed by a government
A) the domestic producers always lower the prices of their products to ensure that their products are sold.
B) the government is trying to discourage consumers from buying foreign-made goods.
C) the supply of the product on the domestic market increases.
D) the price ceiling for the product has to be lowered.

Question

Quizplus · Accepted Answer

Import quotas are a trade barrier imposed by a government to limit the quantity of a certain product that can be imported into the country. When import quotas are imposed, the government is trying to discourage consumers from buying foreign-made goods and instead encouraging them to buy goods made domestically. This is done to protect domestic industries from foreign competition and to promote domestic employment.

When Import Quotas Are Imposed by a Government