A tiny South Pacific island country produces large quantities of coconut-based products. To protect this industry, the island go

Question

2 months ago

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A tiny South Pacific island country produces large quantities of coconut-based products. To protect this industry, the island go

vernment mandates that only designated trading companies can import the crop, each of which is allocated the right to import a maximum number of pounds of coconuts each year. This is an example of a(n)...a. import quota
b. import duty

c. import tariff

d. subsidy

e. local content requirement

Business

1 answer:

Scilla [3.8K] · Answer 1 · 2026-04-11T13:01:49+03:00

The response is:

Import Quota

Explanation:

The option B is incorrect because import duty refers to taxes levied on imported goods and does not restrict or protect the coconut-based products sector.

Option C is also unsuitable since an import tariff is aimed at raising the price of imported products which wouldn’t reflect on the increase of the price for imported goods in this scenario.

Similarly, option D isn't right because there are no subsidies received from the government by the company.

Thus, option A is the correct choice as import quotas limit the ability of companies to import certain goods and services to safeguard local manufacturers.