Deck 4: The Role of Government in Business

Question 1

In the early days of Canada,the small population was scattered across a very large country.The lack of a transcontinental rail line resulted in most trading following a north-south pattern,that is,with the U.S.rather than with other Canadians.

Answer 1

True

Question 2

The process of selling off crown corporations is called privatization.

Answer 2

True

Question 3

In the 1870s,Canadian manufacturers did not require tariff protection as the small population was not large enough to interest U.S.manufacturers.

Answer 3

False

Question 4

Canada's history is replete with many successful examples of government stepping in to produce solutions when the market couldn't such as the setting up of the CNR and Air Canada.

Question 5

Crown corporations can be found in all provinces.

Question 6

Governments try to respond to business needs.

Question 7

Crown corporations are enterprises owned only by the federal government.

Question 8

Since Canada was formed in 1867,the federal government has played a significant role in the economy.

Question 9

The economic development of Quebec is helped by the giant crown corporation,the Caisse de dépôt,set up in 1966.

Question 10

While Hydro Quebec and Canada Mortgage and Housing Corp.are crown corporations,Canada Post and the Ontario Lottery and Gaming Corp are not.

Question 11

The origin of the CNR (Canadian National Railways)in 1919 was the result of the federal government bailing out a troubled major industry.

Question 12

The number of crown corporations is growing as governments continue to increase their control and involvement in the Canadian economy.

Question 13

Governments are an excellent source of employment for graduates.

Question 14

Governments are large employers in Canada.

Question 15

The following are examples of current crown corporations: CBC,Bell Canada,Air Canada.

Question 16

The Alberta Heritage Savings Trust Fund and Québec's Caisse de dépôt et placement are examples of two important federal crown corporations.

Question 17

Governments play a very minor role in the Canadian economic system.

Question 18

Canada's first prime minister is responsible for the National Policy which placed high tariffs on U.S.imports to protect Canada's fledgling companies.

Question 19

Early Canadian governments placed high tariffs on imports from the U.S.to protect Canadian manufacturers.

Question 20

Governments are looking for ways to lower costs and improve efficiencies.

Question 21

The annual Canadian federal budget reveals federal government financial policies for the coming year.

Question 22

One of the major ways the Bank of Canada influences economic conditions is through its control of interest rates.

Question 23

Monetary policy involves the management of the money supply and interest rates by the Bank of Canada.

Question 24

A new trend is the emergence of the public-private partnership (P3).

Question 25

Monetary policy is directly under the control of the Bank of Canada.

Question 26

The Bank of Canada's responsibilities includes setting fiscal policy.

Question 27

The sole purpose of Canada's federal Competition Act is to ensure that all advertising done by corporations meets government standards.

Question 28

Municipalities set certain zoning requirements on businesses including height and distance from the road of all buildings.

Question 29

Interprovincial trade in Canada is hampered by a form of provincial trade protectionism.

Question 30

The Agreement on Internal Trade (AIT)is an intergovernmental trade agreement.

Question 31

Cities like Toronto are looking to privatize services they have traditionally provided as they are required to do so based on new laws and regulations.

Question 32

In Canada,we have a special system of marketing boards that control the pricing of certain agricultural products.

Question 33

In the past,the Competitions Bureau has charged companies with fixing the price of retail gasoline.

Question 34

A debt occurs when a government spends over and above the amount it gathers in taxes over a specific time,such as a fiscal year.

Question 35

The role of municipalities in consumer protection is limited to regulating signage.

Question 36

Provincial governments are responsible for licensing for revenue purposes.

Question 37

The Competitions Bureau sometimes launches investigations to ensure fair completion.

Question 38

The dropping of interprovincial trade barriers would have little effect on Canada's economy.

Question 39

The Bank of Canada is concerned that the economy is growing too rapidly.Given these concerns,it is likely to pursue policies to restrict the supply of money and raise interest rates.

Question 40

Larry wants to buy a new car,and is planning to borrow the money for his purchase from a bank.He has just read in the newspapers that the Bank of Canada is likely to implement policies in the next few weeks that are designed to stimulate the economy,which is currently in a recession.Larry would probably get a lower interest rate on his car loan if he waits until after the Bank of Canada implements its new policies.

Question 41

Tax credits encourage companies to do something to qualify for this tax reduction (often hire new employees or purchase new machinery).

Question 42

Fiscal policy refers to the federal government's efforts to keep the economy stable by controlling the amount of money in circulation.

Question 43

The federal debt is about $583 million.

Question 44

A government change in fiscal policy may involve an increase in the tax load in the construction industry to stimulate the economy.

Question 45

Government taxation policies,called fiscal policy,have some flexibility.In times of a weak economy,taxes may be lowered temporarily to stimulate the economy.

Question 46

The Canadian national debt is also known as the federal debt.

Question 47

The government has two major efforts to control the economy; fiscal policy and monetary policy.

Question 48

One way to lessen annual deficits is to cut government spending.

Question 49

In the United States,people holding subprime mortgages found that at the end of their term,interest rates were much higher and they couldn't make their payments.

Question 50

The size of the national debt increases when the federal government runs a deficit.

Question 51

Reductions in the national debt in the past came about because of surpluses.

Question 52

Our national debt is now less than $200 billion.

Question 53

The national deficit is the difference between our nation's exports and its imports.

Question 54

Taxes are levied from a variety of sources.

Question 55

Senator Spendital has just made a speech deploring the continuous deficits in the federal budget.He is proposing an increase in tax rates to raise more revenue for the government and thus gradually reduce the size of the national debt over a period of several years.The strategy Senator Spendital is proposing is a common type of monetary policy.

Question 56

The economic goal of monetary and fiscal policy is to keep the economy growing.

Question 57

Provincial governments also release their own budgets.

Question 58

When the government attempts to stabilize the economy by changing taxes or government expenditures,it is using the fiscal policy.

Question 59

Fiscal policy involves the federal government's efforts to stabilize the economy by increasing or decreasing taxes and/or government spending.

Question 60

Dr.John Maynard is a professor of economics at a prominent university.Dr.Maynard has recently urged policy makers in our national government to cut taxes and increase government spending in order to pull the economy out of its current downturn.The policy measures called for by the professor are examples of fiscal policy.

Question 61

In special,unplanned but important cases threatening the survival of a major company,the government has a policy of non-intervention.

Question 62

To encourage industrial development in Canada the federal government runs various incentive programs through different departments.

Question 63

Industry Canada produces booklets and materials to inform businesses of the help available and how to get it.

Question 64

Canadian financial institutions faced the same high mortgage default rates as were found in the United States.

Question 65

During the subprime mortgage crisis the Bank of Canada continued to raise its lending rate.

Question 66

The federal government has a "buy foreign" policy when it comes to significant military acquisitions.

Question 67

Some of Canada's economic problems stem from the geographic fact that Canada is a very large country with uneven resources,climate and geography.

Question 68

The 2012 budget allocated billions of dollars in equalization payments to ten provinces in 2012-2013.

Question 69

The federal government in Canada does nothing to encourage industrial development.Such initiatives are all left to the provinces.

Question 70

Equalization is viewed as a means of maintaining the same level of taxation across Canada,although the level of services provided will vary.

Question 71

Contracts are often awarded to help Canadian businesses even if they are sometimes more expensive than bids from non-Canadian companies.

Question 72

When advanced technology is involved in government purchasing,governments make a strong effort to ensure that some of the manufacturing is done in Canada.

Question 73

All government rescue efforts for troubled firms seem to be successful.This is a case for further government help.

Question 74

Canadian governments will buy in Canada only if the Canadian price offered is equal or less than that offered by a foreign company.

Question 75

Federal and provincial policies favouring Canadian businesses are being modified as a result of having NAFTA in place.

Question 76

Governments have many direct and indirect programs designed to help businesses.

Question 77

Payments from the federal government to the lower-income provinces are called legislative payments.

Question 78

68 Transfer payments are direct payments from governments to other governments.

Question 79

Canada's NRC (National Research Council)was set up in 1982 as a specialist organization strictly for university researchers.

Question 80

The Territorial Formula Financing program provides territorial governments with financing.