IGCSE Economics Paper-2: Specimen Questions with Answers 67 - 68 of 100

Passage

As a result of the government strategy, public sector had come to occupy a monopoly of dominant position in basic and heavy industries.

Question 67 (1 of 5 Based on Passage)

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Short Answer▾

Distinguish between a public company and a partnership.

Explanation

Reasons for Firms to Remain Small Are
S. NO.

Public company

Partnership

1.

Public company is a voluntary association of people registered for the purpose of a common objective.

Partnership refers to relation between two or more individuals who agree to share profit in the profit-sharing ratio.

2.

A public company is controlled under the Companies Act.

Partnership firm is regulated by partnership act of 1,932.

3.

A public company should be registered under the Companies Act.

Registration of private company is not compulsory under the partnership act.

4.

The members of the company are not liable for the acts of the company

Partners of a partnership firm are liable for the act of the firm.

5.

Existence of a company is not affected by the change of membership or death or insolvency of any of its members

Partnership is affected by the death or insolvency of any of its members.

Question 68 (2 of 5 Based on Passage)

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Short Answer▾

What are the objectives of Public company?

Explanation

The public enterprise which were promoted as an instrument for implementation of the government’s socio-economic policies had a multitude of objectives set for them:

  • To help in the rapid economic growth and industrialization of the country and create the necessary infrastructure for economic development.
  • To earn return on investment and thus generate resources of development.

  • To promote balanced regional development

  • To create employment opportunities.

  • To promote redistribution of wealth and income

  • To promote import substitution, save and earn foreign exchange for the economy.

Exchange for the Economy

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