Question

The United States and other countries require some products (automobiles in particular) to contain a percentage of local content to gain admission to their markets. This is an example of the stringent usage of _______ to restrict trade.

A. Quotas
B. Tariffs
C. Subsidies
D. Import Licenses

Answer 1

Import quotas are used to restrict trade by limiting the quantity of imported products.

Step-by-step explanation:

The requirement for products to contain a percentage of local content in order to gain admission to a market is an example of the stringent usage of import quotas to restrict trade.

Import quotas are numerical limitations on the quantity of products that a country can import. They are used to control trade by limiting the amount of foreign products that can enter a market.

For example, during the 1980s, the Reagan Administration imposed a quota on the import of Japanese automobiles, which restricted the quantity of Japanese cars that could be imported into the United States.