Geography cls 12
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Questions and Answers

What is the role of a mixed economy?

  • To have no government intervention in the economy
  • To combine elements of both market and planned economies (correct)
  • To have government control over all economic activities
  • To completely rely on market forces

    • What is the basic economic problem?

  • Scarcity of resources to satisfy unlimited wants (correct)
  • Equal distribution of resources
  • Overabundance of resources and limited wants
  • Unlimited resources and unlimited wants

    • What is the function of money in an economy?

  • Guarantee government subsidies
  • Facilitate exchange of goods and services (correct)
  • Control inflation rates
  • Ensure fair distribution of wealth

    • What is the primary role of a central bank in a country's economy?

    <p>Regulate the money supply and interest rates</p> Signup and view all the answers

    What is the purpose of commercial banks in the economy?

    <p>Provide financial services and loans to individuals and businesses</p> Signup and view all the answers

    Study Notes

    Economic Systems

    • A mixed economy combines elements of capitalism and socialism to promote economic growth and stability.

    Basic Economic Problem

    • The basic economic problem arises from the scarcity of resources, which leads to unlimited wants and needs, resulting in the fundamental questions of what to produce, how to produce, and for whom to produce.

    Functions of Money

    • Money serves as a medium of exchange, facilitating transactions and eliminating the need for bartering.
    • Money acts as a unit of account, allowing for the measurement and comparison of the value of goods and services.
    • Money provides a store of value, enabling individuals to save and invest for the future.

    Central Bank

    • The primary role of a central bank is to regulate the money supply, maintain low and stable inflation, and promote economic growth.
    • Central banks set monetary policy, manage foreign exchange reserves, and oversee the stability of the financial system.

    Commercial Banks

    • The primary purpose of commercial banks is to provide financing to individuals and businesses, facilitating economic activity and growth.
    • Commercial banks accept deposits, make loans, and provide other financial services, such as payment systems and credit facilities.

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    Description

    Test your understanding of basic economic concepts with this quiz for class 12 economics. Explore the fundamental economic problem, opportunity cost, and the significance of a mixed economy. Assess your knowledge and enhance your understanding of these key economic principles.

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