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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?
  • Answers:
  1. absorbed by investors
  2. shouldered by taxpayers
  3. passed on to the consumer
  4. 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.

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