What is the primary role of government in a mixed economy?
A) To control all economic activities
B) To regulate and ensure fair competition
C) To determine all production decisions
D) To avoid any interference in the market
Which of the following is a key function of the government in the economy?
A) Providing social services
B) Limiting imports only
C) Banning all forms of trade
D) Setting up monopolies
What role does the government play in regulating the economy?
A) Ensuring wealth redistribution through market forces
B) Setting taxes, subsidies, and tariffs to stabilize the market
C) Allowing complete freedom for businesses
D) Completely controlling the supply of money
The government is responsible for ensuring:
A) Only production targets
B) Economic efficiency through price controls
C) Provision of public goods and services
D) Limiting inflation at all costs
Which of the following is NOT a government intervention in the economy?
A) Taxation
B) Provision of healthcare
C) Price controls
D) Complete deregulation of markets
What is one way the government can help reduce income inequality?
A) Implementing progressive tax policies
B) Allowing unregulated wages in all sectors
C) Reducing public services
D) Increasing private business profits
In which area does the government typically regulate to correct market failures?
A) Setting interest rates
B) Offering unemployment benefits
C) Providing subsidies to failing businesses
D) Ensuring public goods are accessible to all citizens
What is the role of government in controlling inflation?
A) Lowering interest rates
B) Regulating the money supply through central banks
C) Subsidizing all basic goods
D) Printing more money
How does the government influence economic growth?
A) By setting up strict trade barriers
B) Through fiscal policy, including taxation and spending
C) By encouraging monopolies
D) By eliminating all taxes
Which of the following is a key government role in the context of public welfare?
A) Ensuring that only the wealthy have access to healthcare
B) Providing public goods such as education, defense, and infrastructure
C) Making all industries state-owned
D) Limiting the power of all businesses
What is the government’s role in a country’s monetary policy?
A) Controlling the allocation of natural resources
B) Setting minimum wage laws
C) Regulating the money supply to control inflation and interest rates
D) Setting all product prices
The government often intervenes in the economy to:
A) Prevent monopolies and encourage competition
B) Ensure a single company controls all economic sectors
C) Limit foreign investment in the economy
D) Create artificial shortages in goods
What is the role of government in ensuring economic stability?
A) Completely controlling all businesses
B) Balancing budget deficits through spending cuts
C) Implementing fiscal and monetary policies to stabilize inflation and employment
D) Setting production quotas for all industries
How can the government address poverty in an economy?
A) By taxing the poor at higher rates
B) Through welfare programs, unemployment benefits, and job creation policies
C) By cutting all government spending
D) By reducing the national debt at the expense of social services
The government addresses market failures in the economy by:
A) Allowing monopolies to set prices
B) Creating regulations and policies to ensure efficient resource allocation
C) Avoiding intervention in the market
D) Making all businesses state-owned
Which of the following is a government action that can help stabilize the economy during a recession?
A) Increasing taxes and reducing government spending
B) Decreasing interest rates and increasing public spending
C) Reducing welfare benefits
D) Limiting exports
What is the government’s role in protecting the environment?
A) Setting price controls for environmental products
B) Encouraging industries to pollute for economic growth
C) Implementing environmental regulations and promoting sustainable practices
D) Eliminating environmental regulations to boost industrial output
In terms of income distribution, the government can:
A) Allow the market to determine all income distribution
B) Redistribute wealth through progressive taxation and welfare programs
C) Only focus on high-income groups
D) Remove all tax policies
What is the government’s role in providing public goods?
A) Not involved in providing public goods
B) Privatizing all public goods
C) Funding and managing public goods that are non-excludable and non-rivalrous
D) Limiting the production of public goods to only essential services
Which is an example of government intervention to correct income inequality?
A) Implementing progressive tax policies
B) Allowing all businesses to operate freely without restrictions
C) Reducing social security benefits
D) Increasing tariffs on imported goods
The government can influence the supply of money by:
A) Increasing taxes on production
B) Regulating the money supply through central banking policies
C) Reducing tariffs on imports
D) Subsidizing private sector businesses
The government’s role in employment can be seen in:
A) Controlling all job markets directly
B) Promoting policies to reduce unemployment, such as job training and public sector employment
C) Eliminating the minimum wage
D) Encouraging the closure of unprofitable businesses
Which of the following is the government’s role in a capitalist economy?
A) Controlling every market activity
B) Providing a legal framework for property rights and contracts
C) Setting all prices in the economy
D) Eliminating all competition among firms
Government intervention in the market is often necessary to:
A) Encourage monopolies to form
B) Protect consumers, promote fairness, and ensure public welfare
C) Eliminate all taxes
D) Increase government spending in all sectors
The government helps mitigate the effects of negative externalities by:
A) Reducing environmental regulations
B) Encouraging higher levels of pollution
C) Imposing taxes or regulations on polluting industries
D) Ignoring environmental damage in favor of business profits
What is the role of government in stabilizing the economy during an inflationary period?
A) Decreasing taxes and increasing government spending
B) Reducing the money supply and increasing interest rates
C) Encouraging more borrowing
D) Lowering interest rates to stimulate growth
