In the 1980s, deregulation was based on the belief that excessive regulation:
A) Encouraged the markets to take risks.
B) Helped banks gain new customers.
C) Limited the ability of the supply side of the economy to operate efficiently.
D) Built up momentum on the demand side.

Question

Quizplus · Accepted Answer

Deregulation was aimed at reducing the legal and administrative barriers to entry and exit in various industries, including banking and finance. Excessive regulation was believed to limit the ability of the supply side of the economy (i.e., producers, firms, and financial institutions) to operate efficiently, by adding time and cost to the process of bringing new products and services to market. By deregulating, policymakers hoped to spur competition, promote innovation, and improve productivity in the economy.

In the 1980s, Deregulation Was Based on the Belief That