Which term describes the removal of government restrictions to promote competition?

• A. Deregulation
• B. Regulation
• C. Poverty Rate
• D. Tax Equity

Answer: (A)

Deregulation is the removal of government restrictions to promote competition. By loosening rules that limit entry, pricing, or how firms operate, more firms can enter the market and compete. That competition tends to push prices down, improve services, and increase efficiency as firms strive to attract customers. The description fits because it centers on taking away controls to let market forces drive outcomes. The other options don’t fit: regulation means imposing rules, not removing them; the poverty rate is a measure of people living in poverty, not a policy goal; and tax equity concerns fairness in the tax system, not the easing of restrictions to boost competition. A well-known example is airline deregulation, which removed many federal controls on fares and routes and opened the field to more competition.