HSC Economics 2025 – 400 Free Practice Questions to Pass the Exam

Import tariffs are a significant form of government intervention in trade, aimed at controlling the flow of goods between countries. By imposing tariffs, governments can make imported goods more expensive, thereby encouraging consumers to buy domestically produced items. This measure is often employed to protect local industries from foreign competition, helping to maintain jobs and stimulate the domestic economy.

Additionally, tariffs can generate revenue for the government and potentially improve trade balances by reducing imports. As countries negotiate trade agreements, tariffs also play a key role in discussions, as they can influence trade relations and impact international economics.

In contrast, while interest rate changes, wage regulations, and employment laws are crucial aspects of a country's economic framework, they do not specifically target trade practices like tariffs. Interest rates influence economic activity broadly but are not directly related to trade. Wage regulations and employment laws pertain more to labor markets and workforce conditions rather than trade policies. Therefore, import tariffs remain the most direct example of government intervention in trade.