Regulatory Capture Is Where

question 85

Multiple Choice

Regulatory capture is where

• A)governments take over monopolies through use of regulation.
• B)firms impose barriers to entry on regulators.
• C)regulators of an industry look out for the industry instead of society.
• D)the government taxes the profits of monopolies such that all producer surplus goes to the government.

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Definitions:

Adverse Selection

A situation in which one party in a transaction has more or better information than the other, often leading to imbalances and inefficiencies in markets, especially insurance.

Insurance Company

A business that provides coverage, in the form of compensation following a loss, in exchange for premium payments.

Commodities

Basic goods used in commerce that are interchangeable with other goods of the same type.

Norman Daniels

A philosopher known for his work in health ethics, particularly his theories on justice, health, and healthcare.