Why does an import quota lead to deadweight loss, and how does this affect economic efficiency?

• A. It leads to deadweight loss because it restricts trade, reducing economic efficiency.
• B. It leads to deadweight loss because it decreases producer surplus, improving efficiency.
• C. It leads to deadweight loss because it increases consumer surplus, reducing efficiency.
• D. It leads to deadweight loss because it increases government revenue, improving efficiency.

Answer: (A)