Removing tariffs and quotas will ensure that goods are sold by the low-cost producers and increase the sum of consumer and producer surplus.

Question

Quizplus · Accepted Answer

When tariffs and quotas are removed, it allows for free trade and competition among producers. This leads to goods being sold by the low-cost producers, increasing efficiency, and lowering prices for consumers. As a result, both consumer and producer surplus increase. Therefore, removing tariffs and quotas is likely to result in increased economic welfare.

Removing Tariffs and Quotas Will Ensure That Goods Are Sold