A quota is
A) a tariff imposed on goods that are dumped in the country.
B) a law that prevents ecologically damaging goods from being imported into a country.
C) a market-imposed balancing factor that keeps prices of imports and exports in equilibrium.
D) a government-imposed restriction on the quantity of a specific good that can be imported.

Question

Quizplus · Accepted Answer

A quota is a government-imposed restriction on the quantity of a specific good that can be imported. This is done with the intention of protecting domestic industries, promoting self-sufficiency, and/or to prevent the dumping of a product that could damage the industry. A tariff is a tax on imported goods that is imposed by the government. Option B is incorrect because there is no such law. Option C is incorrect because market-imposed balancing factors are known as supply and demand, and they don't necessarily keep prices in equilibrium between imports and exports.

A Quota Is