Chapter 2

Question 1

name the two categories in the public sector

Answer 1

municipal undertakings and state under takings

Question 2

What are municipal undertakings?

Answer 2

They are enterprises or services operated on a commercial basis by local government authorities

Question 3

what are state undertakings?

Answer 3

An enterprise operated on behalf of the government by the public

Question 4

what are other names for a state enterprise

Answer 4

state ownership, public enterprise and nationalized industries

Question 5

How are the profits generated from state undertakings used?

Answer 5

To pay intersest on charges
set aside for future repayment of loans
reinvested to improve or expand the surface

Question 6

Three reasons for state ownership

Answer 6

to save an ailing essential industry and to protect jobs
to keep a natural monopoly
to avoid replication and duplication of devices

Question 7

Give three advantages

Answer 7

It ensures that essential services are always provided
profit benefits the whole nation
it enables large sections of the economy to be planned towards a single strategy