In a modern mixed economy the government ensures that key institutions are in place to facilitate voluntary transactions between economic agents. These key institutions are
A)labour and capital markets.
B)securities regulators and the court system.
C)private property and freedom of contract.
D)the House of Commons and the Senate.
E)the Department of Finance and the Bank of Canada.

Question

Quizplus · Accepted Answer

Private property and freedom of contract are key institutions that facilitate voluntary transactions in a mixed economy. Without private property, individuals would not have the incentive to invest time and resources in producing goods and services. Without freedom of contract, individuals would not be able to negotiate terms and conditions of transactions, leading to inefficiency and potentially harmful externalities. While labour and capital markets, securities regulators, the court system, and the government institutions like the House of Commons and the Bank of Canada are also important in facilitating voluntary transactions, private property and freedom of contract are the most fundamental institutions.

In a Modern Mixed Economy the Government Ensures That Key