Tariffs and import quotas differ in that
A) one is a form of trade restriction, while the other is not.
B) one is a tax, while the other is a limit in quantity.
C) one is imposed by the government, while the other is imposed by the private sector.
D) one is legal, while the other is not.

Question

Quizplus · Accepted Answer

Tariffs are taxes imposed on imported goods, increasing their cost to consumers, while import quotas are direct restrictions on the quantity of goods that can be imported, limiting supply. Both are forms of trade restrictions imposed by governments to protect domestic industries, but they operate in different ways.

Tariffs and Import Quotas Differ in That