Which statement about tariffs and quotas is true?

Which statement about tariffs and quotas is true?

• A. Tariff is a tax on imports; quota is a physical limit on imports; both raise domestic prices and can reduce welfare; quotas can be more distortionary if allocation is non-price-based.
• B. Tariffs increase export prices; quotas reduce domestic prices.
• C. Tariffs and quotas are identical in effect.
• D. Tariffs only affect government revenue; quotas only restrict consumer choice.

Answer: (A)