MANAGEMENT

Detailed explanation-1: -In addition to fiscal and monetary policies, a government affects the economy through regulatory policy, which aims to limit what can be done in the marketplace. Most governments have some regulations covering a variety of areas, including: Banking, insurance, and other financial businesses.

Detailed explanation-2: -Ceiling on managerial remuneration is another way for governments to regulate the relationship between different segments of the economy. This can be done to control income inequality or to ensure that companies are using their resources in a socially responsible manner.

Detailed explanation-3: -Monitoring compliance with contractual obligations to the government and users, and other legal and regulatory requirements. Establishing technical, safety and quality standards (if not defined in the contract agreements) and monitoring their compliance. Imposing penalties for non-compliance.

Detailed explanation-4: -There are four primary approaches to regulating the overall price level1 – rate of return (or cost of service) regulation, price cap regulation, revenue cap regulation, and benchmarking (or yardstick regulation).