One reads the following in a newspaper: "Today the president and Congress agreed to impose new restrictive quotas on Japanese cars coming into the country." As a result, an economist would predict that the

Question

Social Studies

Nyla Mitchell

24 April, 22:39

One reads the following in a newspaper: "Today the president and Congress agreed to impose new restrictive quotas on Japanese cars coming into the country." As a result, an economist would predict that the

+3

Answers (1)

Know the Answer?

Danny Yoder · Answer 1

One reads the following in a newspaper: "Today the president and Congress agreed to impose new restrictive quotas on Japanese cars coming into the country." As a result, an economist would predict that the supply of cars in the country will fall and the (average) price of cars will rise.

Explanation:

It is logical to conclude that if a country imposes restrictive quotas on imports of cars coming from a specific country (such as Japan in this case), there will be a shorter supply of cars in such country and the general price of cars will increase as a consequence of this. There is scarcity of a certain good and this increases its value.