When an import quota is imposed, the gap between the domestic price and the world price is captured by

Question

Quizplus · Accepted Answer

Import quotas limit the quantity of goods that can be imported, creating scarcity and allowing importers to charge higher prices. This difference between the domestic price and the world price, due to the restricted supply, is often captured by the importers who have the right to import the limited goods.

When an Import Quota Is Imposed, the Gap Between the Domestic