A -> the "it" is ambiguous - could refer back to either the 'government' or the 'renegade nation', so eliminate.
B -> Repeats the same pronoun error. Next!
C -> Sounds good! Changes "it" to "that nation". No other errors either.
D -> Completely illogical. The government didn't violate anything! Eliminate.
E -> The same old "it" again.

C makes most sense.
Although this question is from Kaplan, there is no major issue in the question. Also, no common pattern is here.

KAPLAN OFFICIAL EXPLANATION

Step 1: Read the Original Sentence Carefully, Looking for Errors
This sentence contains three errors. First, the underlined pronoun “it” is ambiguous; it is unclear
whether it refers to the “government” or to the “renegade nation,” though logically it should refer
to the latter. Second, while the predicate verb “has imposed” agrees with its subject, “the government,”
the verb tense is incorrect. It makes no sense to say that “the government has imposed
sanctions last month.” When we are describing a single past event that occurred at a specific time
point, we need the simple past tense: “The government imposed sanctions last month.” Third, the
phrase “imposed sanctions” must be followed by the preposition “on” instead of “to” as written.
The correct answer must fix the ambiguous pronoun, the faulty verb tense, and the idiomatic phrase
“imposed sanctions on” without introducing any new errors.

Step 2: Scan and Group the Answer Choices
(A), (B), and (E) retain the pronoun ambiguity. (C) changes “it” to “that nation,” while (D) removes
the pronoun altogether. We have the same 3-2 split for the verb error: (A), (B), and (E) use “has
imposed,” while (C) and (D) use “imposed.” There is also a 3-2 split following “imposed sanctions”:
(B) and (C) add the word “on,” while (A), (D), and (E) do not.

Step 3: Eliminate Choices Until Only One Remains
We can eliminate (A), (B), and (E) because all three commit the pronoun and verb tense errors
we spotted in the original sentence. Of the remaining choices, (D) attempts to fix the ambiguous
pronoun by simply leaving it out: “The government imposed sanctions . . . after violating . . .” This
construction makes it sound as if the same government that imposed the sanctions violated the
treaty, which doesn’t make much logical sense. (C) fixes the pronoun ambiguity and also conveys
the more logical meaning: “That nation” (i.e., the renegade nation) violated the treaty. Because (C)
also fixes the verb tense error by changing “has imposed” to “imposed” and adds the preposition
“on” after “imposed sanctions,” it is the correct answer.

Imposed sanctions on_____

On is a preposition,should it not followed by a noun??

Posted from my mobile device

Hi,
To answer your question, yes, the preposition in this sentence is followed by a noun. A preposition is usually followed by a noun or pronoun as it establishes a connection between two words on the basis of position, placement, and time.

In this sentence, the noun that follows the preposition is “renegade nation”. Between the preposition and the noun, however, there is another verb + preposition (restricted to). There are two actions that the government has done – imposed sanctions and restricted aid. The noun is placed after both the actions.

Because the two verbs take different prepositions after them, both the prepositions must be mentioned to maintain parallelism. So, ‘imposed’ is followed by ‘on’ and ‘restricted’ is followed by ‘to’. The noun ‘renegade nation’ is placed after both the verbs to complete the idea that the government imposed sanctions on and restricted foreign aid to the renegade nation….

I hope this helps.

Jayanthi Kumar.
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Dear CrackVerbalGMAT, dear prateekchugh, dear AnishG, dear community,

I am confused by the tense in answer choice C. From the sentence it is clear that the actions were not performed at the same time. First the terms were violated and then later as a response the both sanction were imposes and foreign aid was restricted.

When things occure at two different points of time they usually use two different tenses. For example present perfect and simple past or simple past and past perfect.

(Furthermore others have argued that present perfect is incorrect because the actions were in the past HOWEVER present perfect does not only have to mean that the action continues but can also mean that the effect of the action continues. Here this seems to be the case as the imposed sanctions still seem to be in effect and therefore their effects still continue.)

A couple of points.

First, regarding the present perfect. Yes, you are correct - that's the textbook definition. But, my question to you is, what are those effects that you speak of? In this particular example, it suffices to say that the government imposed sanctions on and restricted foreign to...(simple past).

Second, the past perfect tense is indeed used to account for the sequence of events. However, the past perfect is NOT ALWAYS required when there are other markers of time (e.g. 'after' in this sentence). It's true that the sanctions and restrictions occurred later in time, but if the sentence makes clear that, that is the case in the absence of the past perfect, then we it's OK.
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I can understand your second point eventhough I still find present perfect preferable.

However I disagree with your first point. The effect of economic sanctions are wide ranging and even after they are lifted the effects do not easily go away.
For example: In a paper by Neuenkirc and Neumeier (2015) it was found the economic sanctions of the US and the UN significantly impacted the GDP growth of the targeted countiry's economy by 2 percent per year and the effects typically lasted for 10 years therefore decreasing the GDP per-capita by 25.5 percent.
Of course this is just one example of the effects. The imposing of sanctions can also leads to loss of market access and therefore market share, investment opportunities, lead to the freezing of accounts or hinder financial transactions and more generally increase economic distress.
There are also many examples of of poverty increasing due to sanctions with effects of malnutition and lack of medical supplies and clean water which can lead to a full humanitarian crisis.
(Counter measures of the country upon which the sanctions are applied can also be expected as an effect)

Of course not all of the effects will always occure HOWEVER the entire reason for economic sanctions are usually that those governments imposing sanctions try to affect the actions of foreign governments, businesses and individuals. Especially, the restriction to foreign aid mentioned in this sentence most likely would lead to immediate effects for the population. Therefore it seems strange to me not to use present perfect as I believe the effects of the sanctions should be expected to persists as long as the sanctions exist and most likely far after they have been lifted (if they are lifted).