In economic terms,tariffs are preferred to quotas because
A)domestic manufacturers gain more producer surplus.
B)there is less loss of consumer surplus.
C)quotas create a greater production inefficiency.
D)given the way quotas are usually administered, tariffs cause a smaller net national welfare loss.

Question

Quizplus · Accepted Answer

Tariffs are preferred to quotas because they cause a smaller net national welfare loss. Quotas create production inefficiency by restricting imports and promoting domestic production, but tariffs allow imports and generate revenue for the government. Additionally, quotas are usually administered through a licensing system, which can lead to corruption and favoritism, while tariffs are more transparent and easier to administer.

In Economic Terms,tariffs Are Preferred to Quotas Because