Future Business Leader Achievments (FBLA) Economics Practice Exam

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Prepare for the FBLA Economics Exam. Engage with detailed explanations and multiple choice questions to boost your understanding of economics concepts. Maximize your success on exam day!

Practice this question and more.

What is one primary purpose of government regulation in business?

To reduce competition
To protect consumer welfare
To create monopolies
To increase prices

The correct answer is: To protect consumer welfare

One primary purpose of government regulation in business is to protect consumer welfare. This involves enacting laws and regulations to ensure that products are safe, services are reliable, and businesses are held accountable for their actions. By implementing these regulations, the government aims to prevent harmful practices, such as fraud, deceit, or unsafe conditions that could endanger consumers' health or finances. Moreover, regulations often require businesses to provide accurate information about their products, which empowers consumers to make informed choices. For example, labeling laws and food safety standards are essential in promoting transparency and ensuring that consumers have access to safe and beneficial goods. Ultimately, consumer protection regulations foster a fair marketplace, promoting trust and stability within the economy.