What do you call a formal agreement or arrangement made by a government with business entities for economic benefits?

The correct answer is a contract. A contract is a legally binding document that outlines the terms and conditions agreed upon by two or more parties, which in this context are the government and business entities. Contracts are often used in various economic relationships to ensure that each party fulfills its obligations, providing clear expectations for performance and compliance. This formal arrangement is crucial for economic benefits, as it helps establish a framework for cooperation and accountability between the government and businesses.

In contrast, a treaty typically refers to a formal agreement between sovereign nations, often concerning peace, trade, or other significant matters. Partnerships usually denote a business relationship where parties engage in joint ventures or share profits and losses but are not necessarily formal agreements made by a government. An agreement is a broader term that can cover various informal and formal arrangements but lacks the specific legal binding aspect that a contract entails.