Question

Use what you have learned to identify reasons that governments create regulations in mixed market economies. Check all that apply.

to protect the health and safety of consumers

to make sure that competition is limited as much as possible

to ensure that competition is fair

to guarantee that all businesses will make money

to educate consumers about specific products

Answer 1

to protect the health and safety of consumers

to ensure that competition is fair

to educate consumers about specific products

Answer 2

The reasons why governments create regulations in mixed market economies are:

• A. to protect the health and safety of consumers
• C. to ensure that competition is fair
• E. to educate consumers about specific products

A mixed market is an economy where all transactions where trade takes place is done in conjunction with the government in order to help regulate the market.

Some characteristics/features of a mixed market include:

• Protection of individual goods
• To ensure that prices are determined by demand and supply
• To protect against monopoly and hoarding
• To serve the self interest of individual business owners.

As a result of this, it is imperative that the government will regulate a mixed market economy so that the health and safety of the consumers will be guaranteed, amongst others.

Therefore, the correct answers are options A, C and E.

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