A ban on imports,a tariff,or a quota raises the price to domestic consumers.This means that consumers will buy less of the product at a higher price.The loss associated with this is called
A) production associated loss.
B) productive consumption loss.
C) consumption distortion loss.
D) consumer misperception loss.

Question

Quizplus · Accepted Answer

The loss associated with raising prices for domestic consumers due to a ban on imports, a tariff, or a quota is called consumption distortion loss. This is because the higher prices distort consumer behavior and lead to less consumption of the product. The other options (production associated loss, productive consumption loss, and consumer misperception loss) do not accurately describe the economic impact of import bans, tariffs or quotas.

A Ban on Imports,a Tariff,or a Quota Raises the Price