Government involvement is necessary due to this type of market system
A)Mixed market system
B)Communistic market system
C)Imperfect competition
D)a & b

Question

Quizplus · Accepted Answer

In an imperfect competition market system, there are usually a limited number of firms dominating the market, meaning that they have significant market power. In such a scenario, the firms can exploit their power by charging higher prices or reducing output to drive up profits, ultimately hurting the consumers. To prevent this, government intervention is necessary in the form of antitrust laws and regulations to promote fair competition and ensure consumer protection. A mixed market system also involves government intervention, but it is not a necessary consequence of the system itself. A communistic market system, on the other hand, is characterized by complete government control and regulation of the market, rendering private enterprises and competition non-existent.

Government Involvement Is Necessary Due to This Type of Market