Final answer:
An increase in the use of quotas is expected to increase a country's current account balance if other governments do not retaliate. This is because quotas reduce imports, and therefore, there is less outgoing payment for imported goods, improving the current account balance while leading to higher domestic prices and less global efficiency.
Step-by-step explanation:
When a country implements quotas, which are maximum limits on the quantity of certain goods that can be imported, this typically leads to a reduction in imports. A consequence of reducing the volume of goods imported is an increase in the domestic production of similar goods to fill the demand, which can improve the domestic economic activity. Additionally, with fewer goods being imported, there will be less outward flow of funds to pay for these goods, which can help to improve the country's current account balance.
However, it's important to note that if other countries retaliate with their own trade barriers, this could start a trade war and have a negative impact. Moreover, while quotas might help to improve a country's current account balance, they also typically result in higher prices for consumers, and a decrease in the overall efficiency of the global market as they interfere with the natural supply and demand equilibrium.