A removal of an import quota tends to result in

Question

Quizplus · Accepted Answer

Removal of an import quota would lead to an increase in the supply of wine, leading to lower prices for domestic consumers. This would increase consumer surplus, and may lead to a decrease in profits for domestic producers, as they may face more competition from imported wines. However, this depends on the elasticity of demand for domestic wines and the degree of substitutability between domestic and imported wines.

A Removal of an Import Quota Tends to Result in