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Economics multiple choice questions

GCSE and O level

Public Expenditure vs Private Expenditure

Multiple Choice Questions and Answers

What is most likely to be the responsibility of a central government?

A the provision of immigration officials at an airport
B the provision of security cameras in a shopping centre
C the provision of security staff at a bank
D the provision of ticket inspectors on a train [J13/P1/Q25]

Answer is A

In 2012 the local government of a city decided to increase parking charges for motorists It was intended to raise money to correct a deficit in the local government’s budget The local government said if they did not increase charges they would not be able to provide all their current services Businesses complained about the likely loss of revenue if parking charges were increased Which concepts does this statement involve?

A inflation and the private sector
B opportunity cost and public expenditure
C private benefit and the free market
D unlimited resources and a centrally planned economy [J14/P1/Q6]

Answer is B

What is not a public sector expenditure?

A claims paid on travel insurance for cancelled flights
B collections of rubbish by a local council to meet regulations on
C grants from central funds to com pensate people whose property has been damaged by storms
D the establishment of a national database to assist the police in finding criminals [J14/P1/Q17]

Answer is A

A large supermarket applied to build on land which was in an area of natural beauty

The local government allowed the building, even though the natural beauty of the area would be lost, because many jobs would be created and much needed income would be brought to the local community

Which economic ideas cannot be found in the above statement?

A external cost and private enterprise
B free market and the conservation of resources
C opportunity cost and improved standards of living
D public sector and external benefit[J151P1/Q8]

Answer is B

What is most likely to be the responsibility of a government?

A. the building of a food processing plant
B. B the building of a housing estate
C. C the building of a large shopping centre
D. D the building(N15/P1/Q16]

Answer is D

A government decides to sell the monopoly supply of gas to households to a private firm How could the government protect the interests of households after sell- ing a large company to the private sector?

A by excluding all competition from foreign companies
B by imposing a tax on excess profits
C by introducing a quota system for imports of gas
D by removing price controls on gas [N16/P1/Q16}

Answer is B

Which type of business organisation is necessarily in the public sector of the economy?

A multinational company
B public limited company
C public corporation
D sole trade [N19/P1/Q12]

Answer is C

What is not included in public expenditure?

A capital spending by firms
B interest payments on government borrowing
C investment in defence by the central government
D subsidies to bus companies from local government [J20/P1/Q16]

Answer is A

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