Economics 2281 · O Level · The role of government

The role of government — practice question

A government gave approval for a new railway line to be constructed between major cities. A private company would build it, although part of the financing would come from taxation. It would generate many jobs. Residents along the route were concerned about damage to their environment. Which concepts are directly involved in this statement?

  • Aexcess demand and public corporation
  • Bgovernment subsidies and perfect competition
  • Cmarket system and income distribution
  • Dprivate benefit and external cost

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