Figure 13-2

-Refer to the FigurE13-2. Which of the following shifts shows the effects of an import quota?
A) a shift of the supply of Canadian dollars (S-
I) curve to the right
B) a shift from D₀ to D₁
C) a shift from D₀ to D₂
D) a shift of the demand for loanable funds curve to the right

Question

Figure 13-2
 
-Refer to the FigurE13-2. Which of the following shifts shows the effects of an import quota?
A) a shift of the supply of Canadian dollars (S-
I) curve to the right 
B) a shift from D₀ to D₁ 
C) a shift from D₀ to D₂ 
D) a shift of the demand for loanable funds curve to the right

Quizplus · Accepted Answer

An import quota reduces the quantity of goods that can be imported, which can increase the demand for domestic currency as foreign buyers need more of it to purchase domestic goods, shifting the demand curve for the currency to the right from D₀ to D₁.

Figure 13-2 -Refer to the FigurE13-2. Which of the Following Shifts Shows