Tariffs and import quotas differ in that

Question

one is a form of trade restriction, while the other is not.

one is a tax, while the other is a limit.

one is imposed by the government, while the other is imposed by the private sector.

one is legal, while the other is not

Answer 1

The correct distinction between tariffs and import quotas is:

one is a tax, while the other is a limit.

A tariff is a tax imposed on imported goods, which increases the cost of importing those goods, while an import quota is a limit on the quantity of a specific good that can be imported into a country.