Question 15

A voluntary export restriction is a restriction of exports by the exporting country.

A voluntary export restriction (VER) refers to a self-imposed limitation by an exporting country on the quantity of goods exported to another country, typically to avoid potential trade disputes and protect domestic industries.

A) A restriction of exports by the exporting country

This option accurately defines a voluntary export restriction. It highlights that the exporting country voluntarily limits the amount of goods it exports, often as a strategic measure to prevent tariffs or other trade barriers from the importing country.

B) An export tariff made by the exporting country

This option is incorrect because an export tariff is a tax imposed on goods being exported, not a restriction on the quantity of exports. A voluntary export restriction does not involve tariffs but rather a limitation on the volume of exports.

C) An import tariff made by an importing country

This option is also incorrect since it describes a tariff applied to imports, which is unrelated to the concept of a voluntary export restriction. A VER deals specifically with exports, not imports.

D) A restriction of imports by the importing country

This choice is incorrect for the same reasons as option C. It pertains to restrictions on imports, while a voluntary export restriction specifically involves limitations imposed by an exporting country on its own exports.

Conclusion

The correct answer, A, precisely captures the essence of a voluntary export restriction as a self-imposed limitation by the exporting country. In contrast, options B, C, and D mischaracterize the nature of a VER either by focusing on tariffs or misapplying the concept to imports, which ultimately reinforces why A is the definitive correct choice.