Question

What is the optimum role of government in a capitalist economy

Answer 1

In a market economy, the government usually acts as a referee, ensuring that the market works properly and achieves the goal of delivering the greatest good to the greatest number of people. Toward that end, the U.S. government regulates certain activities in the market.

Answer 2

Keynesian economists believe that capitalism largely works, but macroeconomic forces within the business cycle require government intervention to help smooth it out. They support fiscal and monetary policy, as well as other regulations on certain business activities

Step-by-step explanation: