Which of the following situations will arise in the domestic market following the removal of an import quota?

Question

Quizplus · Accepted Answer

When an import quota is removed, it becomes easier for foreign producers to export their products to the domestic market, so imports increase. Domestic producers may find it difficult to compete with the increased imports, so their production may decrease. This leads to an increase in supply and a decrease in demand, resulting in lower prices. Therefore, the correct option is B - imports increase, domestic production decreases, and prices decrease.

Which of the Following Situations Will Arise in the Domestic