One reads the following in a newspaper: "Today the president and Congress agreed to impose new restrictive quotas on Japanese cars coming into the country." As a result, an economist would predict that the

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Social Studies

Tamara Fischer

21 January, 08:27

One reads the following in a newspaper: "Today the president and Congress agreed to impose new restrictive quotas on Japanese cars coming into the country." As a result, an economist would predict that the

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Jane Haynes · Answer 1

One reads the following in a newspaper: "Today the president and Congress agreed to impose new restrictive quotas on Japanese cars coming into the country." As a result, an economist would predict that the supply of cars in the country will fall and the (average) price of cars will rise.

Explanation:

It is logical to conclude that if a country imposes restrictive quotas on imports of cars coming from a specific country (such as Japan in this case), there will be a shorter supply of cars in such country and the general price of cars will increase as a consequence of this. There is scarcity of a certain good and this increases its value.