Question：How many of the following are reasons why a government would wish to impose tariffs on imports:

　　To protect domestic jobs

　　To prevent capital flight

　　To protect key domestic industries

　　To optimise the use of scarce world resources.

　　A. 4

　　B. 3

　　C. 1

　　D. 2

　　The correct answer is: B

　　Tariffs do not lead to the optimal use of the scarce world resources.

　　Tariffs are usually imposed to protect infant or key domestic industries, to protect domestic jobs, to prevent capital flight and to equalise costs of production between domestic and foreign producers.

　　However, in recent years there has been a realisation that the presence of tariffs eliminates or reduces the advantages of specialisation and exchange among nations, and therefore prevents the best use of scarce world resources.