Final answer:
A quota is a restriction on the quantity of a product that is allowed to enter or leave a country. It is used to protect domestic industries and manage economic impacts, which can result in higher domestic prices.
Step-by-step explanation:
A quota is a restriction placed on the amount of a product allowed to enter or leave a country. Import quotas serve as a tool for governments to control trade by imposing numerical limitations on the quantity of products that can be imported. Historical examples like the quota on the import of Japanese automobiles by the Reagan Administration and the international Multifiber Agreement demonstrate the use of quotas to manage economic effects such as protecting domestic industries and jobs. Such trade barriers are part of protectionism, which can raise the price of protected goods domestically, benefiting local producers at the expense of consumers.