Question

Economic policies determine

• A. Volume of business
• B. Direction of business
• C. Both direction and volume of business
• D. None of these

Hint:

Government economic policies shape not only “how much” business is done but also “which way” it develops.

Answer 1

The Correct Option is C

Step 1: Meaning of economic policies.
Economic policies are government rules and strategies related to industry, trade, taxation, investment, and markets.
Step 2: Effect on business.
- Volume of business: Policies like tax rates and subsidies affect how much business can expand.
- Direction of business: Policies such as import restrictions, export incentives, and industrial licensing guide where businesses should move.
Step 3: Option analysis.
- (A) Volume of business: True but incomplete.
- (B) Direction of business: True but not complete.
- (C) Both direction and volume: Correct, as economic policies influence both aspects.
- (D) None of these: Wrong, since (C) is right.
Step 4: Conclusion.
Economic policies influence both the direction and volume of business activities.