Question

Assume that the low-calorie frozen, microwavable food company from Assignments 1 and 2 wants to expand, and has to make some long-term capital budgeting decisions. The company is currently facing increases in the costs of major ingredients.

3. Determine whether or not government regulation to ensure fairness in the low-calorie, frozen microwavable food industry is needed. Cite the major reasons for government involvement in a market economy. Provide two (2) examples of government involvement in a similar market economy to support your response.

Answer 1

The government regulation to ensure fairness in the low clorie, frozen microwavable food industry is on identify and carry out the interest of the public without government regulation the food company will produce the substandard goods at higher rates/price. This process will would allow organization to exploit consumer and misuse the power. By having the government regualtion in place. consumer have the peace of mind that some form of price stability will be achieved.

Example 1. In Australia governement imposed food policies in an attempt to prevent obesity and create positive changes in obseogenic environments to achieve the goal the Australia government proposed regulation for healthy food marketing, price reforms and it will help the Australia government for the healthy food by the companies.

Example 2. In United State in 2003 the Food and Drug Administration (FDA) required that trans fat content of less than 0.5 be labeled on food. Trans fat which can be referred to as hydrogenated oils, has been linked to cardiovascular disease with this change the world health organization. With this decision some organization have independently decided to cut the trans fat in their product.

More or less the government regulation with health related product ensure the fairness and help in making the aware to the organization to make healthy food for the population.