The welfare effects of a quota depend to a considerable extent upon ?
Correct answer: D. All of the above
- A. who has the quota license
- B. the size of the quota
- C. elasticities of domestic demand and supply
- D. All of the above
Explanation
Quota welfare effects depend on the quota's size, the demand and supply elasticities, and who receives the quota rents. Since each factor affects the distribution of gains and losses, all the listed factors matter.
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