Which of the following would not be a reason for a government to impose a quota on imports?

Analyze the question

You are asked to find the option that is not a reason for a government to impose an import quota. A quota is a limit on the quantity of a good that may be imported in a given period.

Concept: Why governments use import quotas

Governments restrict imports mainly to:

1. Protect infant or strategic industries from foreign competition.
2. Prevent dumping, where foreign producers sell goods very cheaply in another country.
3. Protect local jobs and create employment opportunities.
4. Improve the balance of payments by reducing import spending.
5. Conserve foreign exchange.

Decreasing tax revenue is never a goal. Governments want to keep or raise revenue, and a quota (unlike a tariff) actually brings in no import duty on the goods it blocks. Reduced revenue is a possible side effect of quotas, not a reason for imposing them.

Step-by-step check of each option

• A. To support strategic industry: a valid reason, because quotas shield local industries.
• B. To prevent dumping: a valid reason, because limiting quantities stops foreign goods flooding the market.
• C. To decrease tax revenue: not a reason. No government deliberately imposes a policy in order to lose revenue.
• D. Employment opportunity: a valid reason, because protected local industries keep and create jobs.

Answer: The option that is not a reason is C.

Exam tip: In "which is NOT a reason" questions, test each option against the policy's real goals: protection, jobs, balance of payments, and preventing dumping. The odd one out is usually the option that describes a harmful result or something no government would want, such as "decrease revenue".