An import quota is a legal limit on the amount of a specific good that can be imported into a particular country. It is designed to restrict the quantity of goods that foreign producers can sell in a domestic market. Import quotas are typically set to protect domestic producers from foreign competition or to address balance of payment concerns.

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An Import Quota Is a

Question 101

Multiple Choice

An import quota is a

A) tax on imports
B) legal limit on the amount of a specific good that can be imported into a particular country
C) tax on import quantities above the legal limit
D) way to increase tariff revenues
E) legal incentive for members of GATT to increase their exports of a particular good

Correct Answer: