11 Analyse the reasons, why government own certain types of businesses. [6]

Ch 2 Classification of businesses

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Abbas17
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Re: 11 Analyse the reasons, why government own certain types of businesses. [6]

Post by Abbas17 »

[KN] Monopoly Control
[AN] Governments may own or control businesses in industries where natural monopolies exist, such as postal services or air traffic control.
[AN+] These sectors are often best served by a single, regulated entity to prevent exploitation of consumers.

[kn] Price and quality control
[an] government owned firms can maintain the quality and price levels.
[an+] This will lead to higher sales as the prices are set according to the quality of the goods
Hussain Asghar
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Re: 11 Analyse the reasons, why government own certain types of businesses. [6]

Post by Hussain Asghar »

KN] Better price and quality control.
[AN] Government ownership can enable the state to control prices, quality, and safety standards in industries that are more beneficial for the customers.
[AN+] This leads towards higher output as prices and quality will be controlled thus leading to satisfied customers.

[KN] Monopolies can be controlled
[AN] Monopolies are created so that higher prices can be charged for low quality goods and exploiting the customers and government can take over these businesses to ensure high quality of goods to be produced.
[AN+] This would result in customers willing to pay for these goods.
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