Which Best Describes the Role that Government and Business Play in Investments?

Which Best Describes the Role that Government and Business Play in Investments?
 

A. They both use taxes to support a country's growth.
 

B. They both invest money to earn a profit.
 

C. They both receive capital to use for growth.
 

D. They both act as angel investors for start-ups.
 

Correct Answer: C. They both receive capital to use for growth.
 

Explanation: The best description of the role that both government and business play in investments is that they both receive capital to use for growth. Governments get the capital mainly in the form of taxes, public bonds, and other public finance mechanisms and reinvest it into infrastructure development, public services, education, and other sectors for the development of the nation. Businesses get the capital from investors, loans, or retained profits and reinvest it into operations, development of the product, expansion, or technology for obtaining profits as well as for maintaining growth.
 

While businesses seek financial gain, the government seeks economic and social development. Neither of them is the primary angel investor (D), which is unique for rich people investing in start-ups. Option A is not true as taxes are used for growth by the government alone. Option B is misleading as the government does not always invest with profit in mind. Therefore, option C is the most accurate regarding their shared contribution towards the utilization of capital for growth.


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