Economists Differ in Their Views of the Role of the Government

question 106

Multiple Choice

Economists differ in their views of the role of the government in promoting economic growth. At the very least, the government should

• A)lend support to the invisible hand by maintaining property rights and political stability.
• B)limit foreign investment to industries that don't already exist in the country.
• C)impose trade restrictions to protect the interests of domestic producers and consumers.
• D)subsidize key industries.

---

Definitions:

Wealth

Wealth represents the abundance of valuable financial assets or material possessions, which can be accumulated, saved, and invested over time to increase an individual's or entity's financial security and economic standing.

Open Market Operations

Operations by a central bank to buy or sell government bonds, corporate bonds, or equities.

Central Bank

A major financial institution responsible for overseeing the monetary system of a nation or group of nations, controlling inflation, issuing currency, and setting interest rates.

Government Bonds

Securities issued by a government to raise funds from the public with a promise to pay periodic interest payments and to return the face value on maturity.