If the US government imposes a quota on imports of a popular doll, the price of...

If the US government imposes a quota on imports of a popular doll, the price of the doll in the US will ________ and the quantity of doll imports purchased in the US will ________.

Group of answer choices

A. fall; decrease

B. rise; decrease

C. rise; increase

D. fall; increase

Expert Solution

Option B.

Given that US government imposes a quota on imports of a popular doll.
When such a quota is imposed, then foreign firms can longer export easily.
This will allow the domestic firm's to raise the price as imports fall.
When imports fall, the quantity of doll imports purchased in the US will decrease.

Rahul Sunny answered 1 year ago

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If the US government imposes a quota on imports of a popular doll, the price of...

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