Question

Why is public expenditure required for industrial development?

• A. Private industrialists are not eager to invest
• B. To gain more profit from certain sectors of the economy
• C. To hamper the process of agricultural development
• D. Influence the distribution of income in the economy

Answer 1

The correct option is A

Private industrialists are not eager to invest

Development of industries requires the development of social infrastructure such as construction of roads and bridges, etc through public expenditure. In many sectors, private industrialists are not eager to invest because of low rates of return and long gestation periods.