A restriction of imports that is accomplished by a quota normally
A)can be accomplished also by a tariff.
B)cannot be replicated exactly by imposing a tariff.
C)can be accomplished also by an export subsidy.
D)can be accomplished also by negotiations within GATT.

Question

Quizplus · Accepted Answer

A quota can be replicated by imposing a tariff of equivalent value (known as an "equivalent tariff") as both measures limit the quantity of imports allowed into a country. However, a quota cannot be replicated exactly by imposing a tariff, as a quota sets an absolute limit on the quantity of imports, while a tariff only increases the cost of imports and may not have the same limiting effect on the quantity of imports. An export subsidy is a measure that encourages exports from a country, and negotiations within GATT may lead to a reduction or elimination of trade barriers, but they do not directly accomplish import restrictions like quotas.

A Restriction of Imports That Is Accomplished by a Quota