2.02 Regulate and Protect Test

Which of the following was one of government’s original roles in business:

• Regulating technology
• ensuring a business’s profitability
• Acting as a referee
• Protecting the environment

One way in which government protects private property is to provide

• Federal Reserve Banks.
• patents or copyrights.
• local governmental programs.
• fire insurance policies.

Government is involved in settling business disagreements through the use of

• force.
• fines.
• negotiation.
• courts.

Why does the government set and collect taxes?

• To increase the use of technology
• To help pay the expenses of government
• To provide economic security
• To help businesses grow and prosper

One of the reasons that has caused government’s role in business to expand is that

• people’s attitudes have change
• products have become very technical.
• costs of production have continued to increase.
• competition in the marketplace has increase

What is the purpose of government regulation of business activities that might cause air or water pollution?

• To protect competition
• To stabilize the economy
• To provide public goods
• To conserve the environment

Determine whether the following statement is true or false: Government has become an active participant in the world of business.

• True; government helps start monopolies.
• True; government produces goods and services.
• False; government works with businesses only.

The goals of government are to protect the rights of individuals and businesses and to provide a stable environment, but the main goal of business is to

• make a profit.
• provide the best products.
• save the environment.
• provide a safe working environment.

Which of the following is a public good that is provided by government

• Private schools
• New automobiles
• Marketing research
• Interstate highways

Government uses some of the tax money it collects from individuals and businesses to support public welfare programs. What is the benefit of these welfare programs to businesses in a private enterprise economy?

• Recipients don’t have to work.
• Businesses must budget more money for taxes.
• Funds received by recipients are spent in businesses.
• Government has control of how the recipients spend their money.