The managers of a firm have to discuss the following topics.
Which topic is least likely to be directly affected by the government’s influence on the firm?
health and safety laws
replacing one of its managers
the interest it pays on borrowed money
the minimum wage it must pay its workers
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Which situation indicates a mixed economy?
Economic activity is controlled entirely by the private sector.
Individual choices are unaffected by government actions.
Services are provided by both private and public sectors.
The government carries out all planning and decision making.
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Which economic system combines elements of both a market economy and a planned economy?
Command economy
Mixed economy
Primary economy
Secondary economy
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Which of the following is not an example of government intervention in a mixed economy?
Allowing the price mechanism to allocate resources
Providing subsidies to firms
Taxing household income
Limiting international trade
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In a mixed economic system, the government's role includes:
Eliminating all competition to ensure fairness
Controlling prices of all goods and services
Prohibiting private ownership of businesses
Addressing market failures and promoting public interest
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The government has an important role in mixed economies. Which function would it not perform?
distributing dividends from profits of state-owned enterprises
employing workers to collect taxes
investing in transport infrastructure projects
producing goods in public corporations
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Which of the following best describes a mixed economic system?
A system where the government controls all economic activities
A system where all economic decisions are made by private individuals and firms
A system that combines elements of both market and planned economies
A system that relies solely on the price mechanism for resource allocation
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What distinguishes a mixed economic system from a market economy?
Absence of private property rights
Complete government control of resources
Lack of consumer choices
Government intervention in certain sectors
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What role does the private sector play in a mixed economic system?
It controls all economic activities
It has no influence on resource allocation
Along with the government it is also involved in resource allocation
It is completely excluded from economic decision-making
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In a mixed economic system, government intervention is primarily aimed at:
Completely replacing market forces
Correcting market failures and promoting social welfare
Reducing consumer choices
Eliminating private ownership of resources
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A government subsidised a new factory in a rural area to create jobs. It also provided training courses at a college. Objectors claimed the development would destroy an area of natural beauty.
What concepts are involved in this statement?
economic growth, resource allocation, free market equilibrium
government intervention, monetary policy, opportunity cost
public good, market prices, fiscal policy
supply-side policy, negative externalities, factors of production
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Governments sometimes intervene in the economy when the market fails.
What is the most likely reason why government intervention may make the situation worse?
Government decisions can take a long time to have an effect.
Governments consider the views of both consumers and producers.
Governments have more resources to calculate costs and benefits than private firms.
Governments may take decisions to reduce negative externalities.
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A key advantage of a mixed economic system is:
Complete elimination of monopolies and market power
Enhanced economic efficiency without government oversight
Provision of public goods without government funding
Ability to address externalities and market failures
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One disadvantage of a mixed economic system is:
Excessive government intervention leading to inefficiency
Inability to ensure equitable income distribution
Elimination of unemployment through government programs
Decreased consumer protection due to market competition
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One of the reasons for adopting a mixed economic system is:
Elimination of public goods
Ensuring absolute private ownership of resources
Balancing economic growth and income redistribution
Promoting monopolies through unrestricted competition
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