Describe the Three Broad Categories of the Federal Regulatory Agencies

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Examlex · Accepted Answer

The Answer is a) Control of supply: Some agencies control entry into certain economic activities.
The Federal Communications Commission grants radio and television licenses.The Food and Drug Administration decides which drugs may enter the American market.The Securities and Exchange Commission acts as a gatekeeper,preventing the entry of new securities into the marketplace until certain standards are met.The general concern is that the market alone cannot adequately protect the public interest.
b) Control of rates: Historically,those federal agencies charged with regulating utilities and carriers (Federal Energy Regulatory Commission,ICC,and CAB) set the prices to be charged for the services offered within their jurisdictions,but the deregulation movement resulted in the elimination of the CAB and the ICC and a general decline in agency rate-setting.The federal government decided to reduce or eliminate its authority in decisions such as the price of airline tickets,cable TV rates,and long-distance telephone rates.
c) Control of conduct:
(i) Information: Agencies commonly compel companies to disclose consumer information that would otherwise remain private.Warning labels,for example,may be mandated.(ii) Standards: Where simply requiring information is deemed inadequate for the public needs,the government may establish minimum standards that the private sector must meet.A ladder might be required to safely hold at least a specified weight,or workers might lawfully be exposed to only a specified maximum level of radiation.(iv) Product banishments: In rare circumstances,products can be banned from the market.The Consumer Product Safety Commission banned the flame retardant Tris (used in children's sleepwear) because of evidence of the product's cancer-causing properties.

Describe the Three Broad Categories of the Federal Regulatory Agencies

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