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3.11 Why does the government intervene in markets to maintain competition?

What students need to learn:

Students should be able to:
Additional Guidance Notes
Government intervention to maintain competition in markets
Explain and evaluate measures aimed at enhancing competition between firms and their impact on prices, output and market structure.

Compare and evaluate the strengths and weaknesses of methods of regulation for example price capping, monitoring of prices and performance targets.
Students should be able to explain why governments may intervene to encourage competition, or prevent monopolies and mergers.

A detailed knowledge of the legislation that relates to competition policy is not required.

Students will need to be aware of various types of private sector involvement in public sector organisations, including contracting out, competitive tendering and public private partnerships (PPP/PFI).

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