Fan and Medal!

Which statement BEST reflects the difference between tariffs and quotas?

A)
Tariffs raise prices on exports, while quotas set limits on imports.

B)
Tariffs raise prices on imports, while quotas set limits on exports.

C)
Tariffs raise prices on exports, while quotas set limits on exports.

D)
Tariffs raise prices on imports, while quotas set limits on imports.

Question

Fan and Medal!

Which statement BEST reflects the difference between tariffs and quotas?

A)
  Tariffs raise prices on exports, while quotas set limits on imports.

B)
  Tariffs raise prices on imports, while quotas set limits on exports.

C)
  Tariffs raise prices on exports, while quotas set limits on exports.

D)
  Tariffs raise prices on imports, while quotas set limits on imports.

ironpatriot · Answer

Tariffs are taxes, or the amount of money a country needs to pay for trading products. Quotas are the limitations on what is traded, how much is traded, how much is paid for each product traded,and where its traded. Tariffs are more beneficial to a country's economy because the amount of money paid for their products raises their country's GDP. Quotas aren't because they put limits on how much is paid, and that is what makes GDPs neutral.

kohai · Answer

Tariffs and quotas are both imposed on import and export products by the government of a country. Tariffs and quotas both serve the purpose of protecting the domestic industry of a country in restricting the quantity of products imported or exported and also earn revenue for the government. Tariffs, basically, refer to a form of tax imposed on exports and imports, and a quota refers to the limitations imposed on the quantity of products exported or imported.