Government Regulation

How can governments regulate price and output?

Governments play an integral role in the free market economy. It’s purpose lies in the regulation of price and output through implementing laws and regulations in order to prevent market failure, protect the environment and ensure that an economy is sustainable. Examiners like to test students on how well they understand the roles and responsibilities a government has in the economy as well as on their ability to suggest and improve upon current regulations to better handle economic ills.