What happens to the expenses involved in compliance with government regulations?
Question 8a of 10 - Consumer protection regulations
- Maximum Attempts: 1
- Question Type: Multiple Choice
- Maximum Score: 2
- Question: What happens to the expenses involved in compliance with government regulations?
- absorbed by investors
- shouldered by taxpayers
- passed on to the consumer
- covered by transfer payments
The correct answer is: passed on to the consumer. Complying with consumer-protection regulations costs producers money, which increases production costs that are eventually passed along to consumers in the form of higher prices.