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To limit trade between countries, a country may place a quota on imports and exports.
Alternatively, please note, that tarrifs can be placed on exports (like the Tea Tax) which can discourage trade between two or more countries.
A quota on imports and exports is an example that might work to limit trade between countries.
Further explanation:
Quotas are trade restrictions which are imposed by government and it limits the monetary value or money of goods which country can export or import during a particular period. The quota is used by countries in international trade. The volume of trade is regulated by the use of quotas between the countries.
QUOTA
Quota is different from customs or tariffs, which place taxes on exports and imports. Governments impose both tariffs and quotas as protective measures that control trade between countries. There are various differences between them also.
There are basically three forms of quotas in the United States:
- Absolute
- Tariff-rate
- Tariff preference
The highly restrictive quotas paired with high tariffs helps in leading trade disputes and also other problems between countries.
Government designs tariffs to raise the cost to the supplier seeking or producer to sell product within a country.
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Answer details:
Grade: Middle School
Subject: Social Studies
Topic: Quota
Keywords: quotas, exports, imports, governments, tariffs, disputes, tariff-rate, absolute, money, international trade