Figure 5.6 Domestice Supply and demand for Wine - U.S.
-Consider Figure 5.6.In the global market for wine, the EU is willing to supply as much wine as the U.S.demands at $8 per bottle.If the U.S.imposes a quota of 15 bottles of wine, how much revenue will the U.S.government collect?

Question

Figure 5.6 Domestice Supply and demand for Wine - U.S. 
-Consider Figure 5.6.In the global market for wine, the EU is willing to supply as much wine as the U.S.demands at $8 per bottle.If the U.S.imposes a quota of 15 bottles of wine, how much revenue will the U.S.government collect?

Quizplus · Accepted Answer

Quotas limit the quantity of goods that can be imported but do not directly generate revenue for the government. Tariffs, not quotas, are what generate revenue through taxes on imported goods.

Figure 56 Domestice Supply and Demand for Wine - U