Differentiate between deregulation and commercialization.
(b) The government of country Z wishes to sell its transport company
. (i)Name the policy that the government wishes to adopt
(ii)Explain five reasons which could have necessitated the government's course of action.
(a) Deregulation involves allowing the market or seller of a product to determine the price with which they will sell their product, while commercialization involves converting a non-profit-making corporation to a profit-making corporation.
(b) Privatization
ii) Reasons for privatization
(I) Liability of government continues to fund the corporation: When the government becomes unable to fund the corporation, the government can decide to privatize the company
(II) Inefficiency: If a corporation is inefficient under the auspices of government and such a corporation needs to be efficient, the government can decide to privatize as well
(III) Source of revenues: If the government needs money to fund some critical projects, the government can privatize some of its corporations to generate revenue.
(iv) Competition: If the government intends to promote competition in a sector or an industry, the government can sell its shares in the industry to private. owners.
(v) Corruption in a corporation can also make the government to privatize its corporation
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