One advantage of a tariff over a quota,from the perspective of the nation imposing it,is that a tariff
A)decreases the domestic price
B)increases the foreign price
C)increases the quantity of imports
D)decreases the quality of imports
E)raises tax revenue

Question

Quizplus · Accepted Answer

A tariff raises tax revenue for the nation imposing it, while a quota does not generate revenue directly. Options A, B, and D are incorrect because the purpose of a tariff is to increase the domestic price, decrease the foreign price, and maintain the quality of imports. Option C is also incorrect because a tariff aims to restrict the quantity of imports.

One Advantage of a Tariff Over a Quota,from the Perspective