Answer:
Ans. Any market needs rules and regulations because of the following reasons: (i) Individual consumer often find themselves in a weak position. In case of complaint regarding a good or service that had been bought, the seller tries to shift all the responsibility on to the buyer. (ii) Sometimes traders indulge in unfair trade practices such as, when shopkeepers weigh less than what they should. (iii) Markets do not work in a fair manner when producers are few and powerful, a long battle had to be fought with court cases to make cigarette manufacturing companies accept that cigarette causes cancer. (iv) Large companies with huge wealth, power and reach can manipulate the market in various ways. At times, false information is passed on through the media and other sources to attract consumers. (v) Consumers are also exploited when they purchase in small amount and are scattered. For example, a company for years sold powder milk for babies all over the world as the most scientific product claiming this to be better than mother?s milk. It took years of struggle before the company was forced to accept that it had been making false claims.
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