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Which of the following is NOT a way that government serves as a regulator in the marketplace?

1) Setting price controls
2) Enforcing antitrust laws
3) Providing subsidies to businesses
4) Promoting competition and consumer protection

1 Answer

1 vote

Final answer:

Among the options listed, 'providing subsidies to businesses' is NOT a way the government serves as a regulator in the marketplace. Subsidies are a form of support or financial aid, rather than a regulatory measure, which the government offers to businesses to promote economic and social policy.

Step-by-step explanation:

The question you have asked relates to the different ways in which the government can serve as a regulator in the marketplace. To identify which of the given options is NOT a method by which the government regulates the market, let's examine each one.

  • Setting price controls - This is a regulatory action. Governments may set maximum or minimum prices to control the cost of essential goods.
  • Enforcing antitrust laws - These laws are meant to prevent monopolies and promote fair competition, indeed a regulatory function.
  • Providing subsidies to businesses - This is not typically a regulatory action. Instead, it is a means by which the government can support certain industries or activities.
  • Promoting competition and consumer protection - This serves as both a regulatory and a protective function of the government to ensure fair play and protect consumers from fraud and unsafe practices.

Therefore, the correct answer is that providing subsidies to businesses is NOT a way the government serves as a regulator in the marketplace. Subsidies are a form of financial aid or support extended to an economic sector, with the aim of promoting economic and social policy. While regulation involves setting rules and ensuring compliance, subsidies are meant to provide direct support, often with the goal of stimulating growth or providing a public benefit.

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