Country X wants to protect their domestic trade and considers placing trade barriers. Which of the following tools can country X use?

Revoke permits of domestic companies

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Import quota

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Restriction on domestic production

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Taxation

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Solution

The correct option is D Taxation
Trade barriers are trade policies designed to restrict international trade with other countries. Countries use various tools to restrict international trades like the imposition of heavy taxes and the restrictions on import quantities, which is also known as import quota.

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Similar questions

Q3. Consider the following statements about Trade War:

1. A trade war happens when one country puts up a trade barrier, like strict tariffs.

2. It is done to protect its economy from foreign competition.

Which of the statements are correct?

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