Which of the following is the most accurate representation of the government's role in resource allocation according to the fiscal function of…

CA Foundation · Business Economics · MTP · January 2025
Which of the following is the most accurate representation of the government's role in resource allocation according to the fiscal function of public finance?
(A) A. The government maximizes profits by privatizing public goods.
(B) B. The government ensures the efficient distribution of resources in competitive markets.
(C) C. The government allocates resources to public goods like defence and infrastructure.
(D) D. The government avoids intervening in resource allocation to maintain market efficiency.

Suggested Answer and Working Notes:

Correct Answer: Option (C)

C. The government allocates resources to public goods like defence and infrastructure.

Topics: Public Finance

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