Author Question: Describe two major ways governments regulate businesses and what effect this regulation has on ... (Read 87 times)

magmichele12 · **on:** Jun 24, 2018

Describe two major ways governments regulate businesses and what effect this regulation has on business.

Question 2

Describe four kinds of political risks in international business.

bimper21 · **Reply #1 on:** Jun 24, 2018

Answer to Question 1

Answers should include the following points:
(1) Governments use health and safety regulations to protect workers.
(2) Governments use consumer protection laws to protect consumers from unsafe products and deceptive or false advertising practices.
(3) Government regulation generally increases the cost of doing business and may make a product less competitive with products manufactured in countries that do not have such strict regulation.

Answer to Question 2

Answers should include four of the following:
(1) Trade sanctions: sanctions from tariffs to boycotts that arise from foreign policy decisions.
(2) Expropriation: confiscation of a company or property.
(3) Economic nationalism: restricting foreign ownership and legislating against foreign imports.
(4) Civil war, revolution, or uprisings within a country.
(5) War with another country.