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Free CIMAPRA17-BA1-1 Exam Braindumps
BA1 - Fundamentals of Business Economics Questions 201–205 (page: 42)

Updated On: 9-Feb-2026
Page 42 of 95
PDF with 468 Questions

Which of the following is an example of regulation as a form of government intervention in the economy?

  1. The government requiring that seat belts are fitted in all coaches and regularly tested
  2. The government announcing the abolition of rules which restrict the number of commercial radio stations allowed by law to operate
  3. The government encouraging the General Medical Council to discipline doctors judged to be professionally negligent
  4. The government selling a state-owned industry such as Air Traffic Control to private ownership

Answer(s): A



Whenever a government provides health care services free of charge

  1. Economic welfare is maximized
  2. Government expenditure on the provision of public goods increases
  3. The incentive to provide private health care through the market disappears
  4. Provision of merit goods by the state is taking place

Answer(s): D



The burden of an indirect tax on a good will fall most heavily on the producer when

  1. the demand for the good is price inelastic and the supply is price inelastic
  2. the demand for the good is price inelastic and the supply is price elastic
  3. the demand for the good is price elastic and the supply is price inelastic
  4. the demand for the good is price elastic and the supply is price elastic

Answer(s): C



All of the following are appropriate policies to deal with the problem of industries which cause pollution except which one?

  1. Taxes on the consumption of the product
  2. Subsidies to the producers
  3. The auctioning of pollution permits
  4. Legal controls to limit pollution levels

Answer(s): B



Regulatory offices have been established after the privatization of some nationalized industries because

  1. some industries retain significant monopoly power
  2. the number of new producers entering the industry must be controlled
  3. these privatized industries produce public goods
  4. government regulations make monopolies in the private sector illegal.

Answer(s): A



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