What is a limit placed on foreign goods to reduce supply and increase prices?

The correct answer is based on the understanding of how trade restrictions are implemented to manage the flow of foreign goods in a country.

A limit placed on foreign goods specifically to reduce supply and increase prices is best described as a quota. Quotas set a physical limit on the quantity of a good that can be imported over a specific period. By restricting the quantity available in the market, quotas effectively decrease the supply of that good. When supply decreases while demand remains constant, prices tend to rise, benefiting domestic producers who can charge higher prices for their goods.

In comparison, tariffs are taxes imposed on imported goods designed to make them more expensive and less competitive. While they can also lead to higher prices, the mechanism is different from that of quotas, which strictly limit supply rather than impose a financial cost.

Subsidies are direct financial support or incentives provided to domestic producers to compete against foreign imports, which can lower prices instead of increasing them. Sanctions are political tools that prohibit trade with specific countries but do not specifically limit foreign goods for the purpose of regulating prices in the domestic market like quotas do.

Thus, the distinct role of quotas in controlling the amount of foreign goods directly correlates to the goal of reducing supply and consequently driving prices up,