ECONOMICS
BARRIERS TO TRADE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Tariff
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Quota
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Embargo
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None of the above
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Detailed explanation-1: -MEXICO CITY, Feb 7 (Reuters)-Mexico opened an additional sugar import quota of 250, 000 tonnes for 2010 to cover an expected shortfall in the domestic harvest, the economy ministry said on Sunday. The ministry said the quota would run until May 20. Our Standards: The Thomson Reuters Trust Principles.
Detailed explanation-2: -Common examples of protectionism, or tools that are used to implement a policy of protectionism include tariffs, quotas, and subsidies. All of these tools are meant to promote domestic companies by making foreign goods more expensive or scarce.
Detailed explanation-3: -Definition: Customs Duty is a tax imposed on imports and exports of goods.
Detailed explanation-4: -Other destinations for Mexican exports include Canada, China, Germany, and Japan. As per imports, the main origins include the US, China, South Korea, Germany, and Japan. Mexico has signed a dozen free-trade agreements with about forty different countries of the world.
Detailed explanation-5: -(a) The Effect of Tariffs A tariff-induced price rise creates a gap between prices in the importing and exporting countries. This in turn causes supplies (production) to rise in the importing country, while demand (consumption) falls, which is the essence of the “industrial protection” function of tariffs.