Question

The society needs several goods and services. However, the private sector does not produce all of them. Identify the correct reason for the private sector not being able to cater to the needs of the society.

• A.
  The private sector lacks space to work
• B. The private sector lacks employees
• C. The private sector is profit driven
• D. The private sector is entertainment driven

Answer 1

The correct option is C The private sector is profit driven

Some services, such as defence services, require a lot of spending and do not make any profit. Activities in the private sector are guided by the motive to earn profit and not the welfare of people. There are several services needed by the society, which the private sector cannot provide at a reasonable price. Activities like construction of roads, bridges, railways, irrigation through dams, and more require a huge amount of money, which is beyond the capacity of the private sector. Also, private sector charges are high for the use of these services. Further, it is difficult for the private sector to collect money from thousands of people who use these services.