What is the main difference between a quota and a voluntary export restraint?
A) There are no differences between a quota and a voluntary export restraint.
B) The importing country administers a quota; the exporting country administers a voluntary export restraint.
C) A quota affects a country's imports, while a voluntary export restraint affects its exports.
D) A quota has deadweight losses, while a voluntary export restraint has no deadweight losses.

Question

Quizplus · Accepted Answer

A quota is typically imposed by the importing country to limit the quantity of a certain good that can be imported. On the other hand, a voluntary export restraint (VER) is an agreement by the exporting country to limit the amount of goods exported to the importing country, often to avoid more stringent trade restrictions or tariffs.

What Is the Main Difference Between a Quota and a Voluntary