Economics: Role and Macroeconomic aims of government

1. Which form of government collects taxes to fund services such as refuse (rubbish) collection, street lighting, libraries and public parks?

• a. Central government

• b. International government

• c. Local government

• d. National government.

2. What is the general role of a government?

• a. to allocate scarce resource

• b. to improve the general welfare of its people

• c. to provide infrastructure such as roads

• d. to provide welfare benefits to low income household

3. Which is not included in the uses of tax revenues?

• a. healthcare

• b. infrastructure

• c. national security

• d. tariffs and excise duties

4. What does the national government not make decisions on?

• a. Fiscal policy measures

• b. Provide street lighting

• c. Monetary policy procedures

• d. Level of infrastructure

5. Which option is most applicable to the role of international government?

• a. Financial support for local libraries

• b. The formation of a regional trading bloc

• c. The funding of national defense programmes

• d. The imposition of tariffs and quotas

6. Which is used by international governments to promote free trade and mobility of factors of production between member countries?

• a. Enterprise zone

• b. Market economy

• c. Trading bloc

• d. Planned economy

7. Which refers to an increase in a country’s real gross domestic product (GDP) over time?

• a. Full employment

• b. Economic growth

• c. Inflation

• d. Redistribution of income

8. Which is calculated by using a weighted price index?

• a. Full employment

• b. Economic growth

• c. Inflation

• d. Redistribution of income

9. Which option is the least likely economic consequence of high unemployment?

• a. A fall in the level of consumption due to lower earnings

• b. A fall in the level of national income

• c. Higher government expenditure on welfare benefits

• d. An increase in the rate of inflation

10. Which is most likely to conflict with the government aim of high economic growth?

• a. Balance of payments deficit

• b. employment opportunities

• c. higher tax revenue

• d. Inflationary pressures