Revision Quiz Unit 3

What is the primary objective of a market economy?

• To ensure equal distribution of resources

• To maximize profits through market forces

• To promote government regulation

• To eliminate private ownership

Who manages a country's foreign exchange reserves?

• Commercial banks

• Central bank

• International banks

• Ministry of trade

What causes market failure?

• Perfect competition

• Public goods and externalities

• High consumer satisfaction

• Technological advancements

What is a characteristic of a mixed economy?

• Total government control

• No government intervention

• Combination of public and private sectors

• Equal distribution of income

Which tool helps the central bank control inflation?

• Reducing interest rates

• Increasing interest rates

• Decreasing reserve requirements

• Printing more money

What is an example of a negative externality?

• Education

• Pollution

• Vaccination programs

• Public parks

What type of deposit is used for daily transactions?

• Savings account

• Fixed deposit account

• Current account

• Recurring deposit account

What motivates businesses in a market economy?

• Profit

• Public welfare

• Equality

• Regulations

What is the main goal of monetary policy?

• Eliminate taxes

• Control inflation and stabilize the economy

• Increase imports

• Decrease economic growth

Which of the following can correct market failure?

• Government regulation

• Monopolies

• Unlimited consumer spending

• No taxes