Hello. Are the following answers correct? How could I provide a better answer? question 1-4 (B A A C) For question 3, is it correct? Is the correct answer A or D?

1. A firm is a unit

A. organized by the Government

B. that acts a link between the factor market and product market

C. that provides services to the public

D. all of the above

2. A private enterprise

A. always aims at making profits

B. is the same as a Public Corporation

C. is a unit belongs to the households

D. is usually described as bureaucratic

3.A public enterprise exists because

A. it is expensive to provide certain kinds of services

B. it is more efficient than private firms

C. it has higher incentive to make profits

D. none of the above

4. A Public Corporation is

A. a privately owned organization

B. a special type of Public Enterprise

C. controlled closely by the Government

D. free from any competition

5. How is a Private Enterprise different from a Public Enterprise?

Private Enterprise mainly aims at profit maximization. Also, it is not controlled by the government.

Refer to the following piece of information and answer the questions that follow:

The Airport Authority Hong Kong is wholly owned by the Hong Kong Special Administrative Region (HKSAR) Government. It was formally established on 1 Dec 1995 and is required to conduct business in accordance with prudent commercial principles.

To which specific type of business ownership does the Airport Authority belong?

Public corporations

Give TWO characteristics of this type of business ownership.

They operate on commercial principles and are financially independent of the government.

An independent board of directors is appointed by the government to manage this business ownership.

Does this type of business ownership have high incentive? Explain.

Yes. They operate on commercial principles. Since they are financially independent of the government, they need to operate on a self-financing basis. They had to work hard to maintain a healthy financial condition.

Also, as most of their staff are not civil servants, their salaries and job position promotion more depends on their working performance. Hence, staff tend to work harder and do their best performance, which make the firm obtain a high incentive.

Also,