Which statement best describes the role of government in a mixed economy?
1) it controls all decisions about business activities, including profit levels.
2) it forms companies and then allows individual managers to run them.
3) it follows a strict policy of laissez-faire. (my answer)
4) it regulates businesses when the public interest is involved.
Please help Ms. Sue!
My next best answer would be four.
Yes, 4 is right. Think about how the government regulates the food industry to make sure that our food is safe to eat.
Thank you so much Ms. Sue
You're very welcome, Michael.
Based on the provided answer choices, statement 3) is the correct one. The role of the government in a mixed economy does not involve controlling all business decisions or forming companies and letting individual managers run them. Additionally, a mixed economy does not adhere to a strict policy of laissez-faire, which means minimal government intervention in the economy. Instead, the government in a mixed economy typically regulates businesses when the public interest is involved.
To arrive at this answer, it's helpful to have a basic understanding of what a mixed economy entails. In a mixed economy, there is a combination of free market elements and government intervention. The government plays a role in regulating various aspects of the economy, such as setting safety standards, establishing labor laws, and preventing monopolies, among others. Its aim is to strike a balance between private enterprise and public welfare.
By eliminating the answer choices that do not align with the role of government in a mixed economy, you can identify the most suitable option.