Final answer:
The economic policy where the government regulates the price of goods and services is referred to as Socialism. Capitalism relies on the free market with minimal government intervention, while competition helps regulate prices in a capitalist economy. Socialism involves more direct government regulation over economic aspects.
Step-by-step explanation:
The type of economic policy where the government regulates the price of goods and services is commonly associated with Socialism. In a pure market economy or Capitalism, there is minimal government intervention, allowing prices to be set freely by the forces of supply and demand. However, under Socialism, the government has a much more active role in the economy, including the regulation of prices in an attempt to achieve certain social and economic outcomes. This can include policies like imposing price controls to prevent inflation or to ensure affordability of essential goods and services to the population.
Contrary to this, Competition is characteristic of a capitalist economy where sellers and buyers have the freedom to influence prices, rather than having them mandated by the government. Additionally, although all market-based economies, including mixed-market economies, operate within a framework of laws and regulations, the degree of price regulation varies, with some level of government intervention being common to address issues such as monopolies, protect consumers, and maintain fair markets.