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Question
Microeconomics
Posted 6 months ago

In the interest of public health, the nation of Burginville prohibits bakeries from selling more than 1000 cronuts per week.

What is the term for the control imposed on the cronut market in Burginville?

Choose 1 answer:
(A) An excise tax
(B) A quota
(C) A tariff
D) A price floor
(E) A price ceiling
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Answer from Sia
Posted 6 months ago
Solution
a
Definition of Quota: A quota is a government-imposed trade restriction that limits the number or monetary value of goods that a country can import or export during a particular period
b
Application to Cronut Market: In the context of the cronut market in Burginville, the control imposed is a restriction on the quantity of cronuts that bakeries can sell per week. This is a classic example of a quota
Answer
(B) A quota
Key Concept
Quota
Explanation
A quota is a limit on the quantity of a good that can be sold, which matches the restriction in Burginville's cronut market.

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