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makvit [3.9K]
3 years ago
6

Describe the three roles of the goverment within the economic flow

Social Studies
1 answer:
valentinak56 [21]3 years ago
7 0

Answer:

the role of government  within the economic flow includes the following:

1. The government in their capacity provides the legal and social framework within which the economy operates: the government  states and enforce property rights,set up a court system and different laws are passed, all selling and buying of properties must pass through the legal system, they  also established a monetary system whereby they control the amount of money that is being circulated within the economy and also monitor financial institutions(banks.)

2. maintains competition in the marketplace:by maintaing competition in the market place, the government ensures peace, easy work flow and they  also create and enforce antitrust laws, and  control natural monopolies in the market place. due to the fact that the government encourage competitions among companies, it has therefore help to regulate the prices of goods and services because companies will not like to increase their price because of competitions in the marketplace.

3.  redistributes income; the government has also help in the redistrubution of income from individuals of higher earnings/ incomes to those with lower  earnings/incomes through the use of higher tax rate to high income earners and vice versa. most individuals cannot afford to get the basic necessities of life if  the government do not use the method of income redistribution because this tax are used by government to provide public services like hospitals, schools, free meals to the people.

Explanation:

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