Match List-I with List-II.
| List-I | List-II |
| (A) Reallocation of resources | (I) Government intervention to either expand demand or reduce it |
| (B) Redistribution of Income | (II) Subsidies on new business setup |
| (C) Stability function | (III) Public goods to be provided by government |
| (D) Employment generation | (IV) Imposing more tax on high income group |
Choose the correct answer from the options given below :
Answer & explanation
Correct answer: option 4
The correct answer is option (4) : (A)-(III), (B)-(IV), (C)-(I), (D)-(II)
Reallocation of Resources (A): This refers to the process of shifting resources from one use to another,often achieved through government intervention. Public goods, like national defense or infrastructure, are a prime example where resources are allocated by the government to meet societal needs.
Redistribution of Income (B): Taxing high-income earners more and potentially using those funds for social programs is a way to redistribute income and reduce inequality.
Stability Function (C): The government can influence economic stability through various measures, including managing aggregate demand. This might involve stimulating demand during recessions or curbing it during inflationary periods.
Employment Generation (D): Subsidies for new businesses can incentivize their creation, potentially leading to more job opportunities.
| List-I | List-II |
| (A) Reallocation of resources | (III) Public goods to be provided by government |
| (B) Redistribution of Income | (IV) Imposing more tax on high income group |
| (C) Stability function | (I) Government intervention to either expand demand or reduce it |
| (D) Employment generation | (II) Subsidies on new business setup |