Which is an example of regulation in the automobile industry?
(i) the installation of satellite radio systems in some cars.
(ii) the usage of multiple-year warranties to cover repairs.
(iii) the creation of fuel-efficiency standards for cars.
(iv) the production of hybrid models that conserve gasoline.
The correct answer is option (iii) the creation of fuel-efficiency standards for cars.
Regulations in Industries
In the context of economics, the government may establish certain regulations in various industries to reduce negative externalities or protect consumer interests. Some examples of regulations are reducing the barriers to entry in industries and establishing a threshold on pollutants emitted by firms in an industry.