MANAGEMENT

Detailed explanation-1: -The government (1) provides the legal and social framework within which the economy operates, (2) maintains competition in the marketplace, (3) provides public goods and services, (4) redistributes income, (5) cor-rects for externalities, and (6) takes certain actions to stabilize the economy.

Detailed explanation-2: -In order to protect the interest of consumers government fixes the maximum price of the commodity. This maximum price is generally lower than the equilibrium price. This is called control price or ceiling price.

Detailed explanation-3: -In market economy, the economy is a free market economy with no interference from the Government. The prices of the commodities in this economy are fixed on the basis of free forces of demand and supply in the market.

Detailed explanation-4: -In any market transaction between a seller and a buyer, the price of the good or service is determined by supply and demand in a market. Supply and demand are in turn determined by technology and the conditions under which people operate.