Consider the following statements regarding the regulation of markets and economic interactions: 1. Laws are enacted solely to protect the profit margins of producers without regard for consumers. 2. State intervention is often required in markets to prevent the exploitation of vulnerable groups. 3. The chain of markets linking producers to buyers involves buying and selling at every step. Which of the statements given above is/are correct?

The correct option is (c) 2 and 3 only. Explanation In a mixed economy or a democratic setup, the government plays a crucial role in regulating economic interactions to ensure fairness. Markets involve a complex chain of transactions linking producers to consumers, necessitating legal frameworks to balance interests and prevent exploitation. Statement-wise Analysis: - Statement 1 is Incorrect: Laws are not enacted solely to protect the profit margins of producers. The legal framework aims to regulate relations between workers, producers, and consumers to ensure justice for all parties. For instance, laws exist to ensure minimum wages for workers and safety standards for consumers, often limiting the arbitrary pursuit of profit. - Statement 2 is Correct: Markets tend to work in the interest of the powerful and wealthy. Without regulation, vulnerable groups such as unorganized workers, small farmers, and consumers may be exploited through low wages, unfair prices, or hazardous working conditions. State intervention is required to enforce rules that ensure fairness and social justice. - Statement 3 is Correct: The chain of markets refers to the series of exchanges that goods undergo before reaching the final user. It starts with the producer (e.g., a farmer or factory) and passes through various intermediaries like wholesale traders and retailers. At every link in this chain, buying and selling take place. Key Takeaway: State intervention in markets is essential to prevent the exploitation of vulnerable sections, and the market mechanism functions through a continuous chain of buying and selling across multiple intermediaries.

NCERT Class 8 Political Science — Chapter 6: Law and Social Justice

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Consider the following statements regarding the regulation of markets and economic interactions:

Laws are enacted solely to protect the profit margins of producers without regard for consumers.
State intervention is often required in markets to prevent the exploitation of vulnerable groups.
The chain of markets linking producers to buyers involves buying and selling at every step.

Which of the statements given above is/are correct?

Official previous-year question

Verified 1 Aug 2026.

Options

A1 and 2 only
B2 only
C2 and 3 only
D1, 2 and 3

Did you get this right?

Solution

The correct option is (c) 2 and 3 only.

Explanation

In a mixed economy or a democratic setup, the government plays a crucial role in regulating economic interactions to ensure fairness. Markets involve a complex chain of transactions linking producers to consumers, necessitating legal frameworks to balance interests and prevent exploitation.

Statement-wise Analysis:

Statement 1 is Incorrect: Laws are not enacted solely to protect the profit margins of producers. The legal framework aims to regulate relations between workers, producers, and consumers to ensure justice for all parties. For instance, laws exist to ensure minimum wages for workers and safety standards for consumers, often limiting the arbitrary pursuit of profit.
Statement 2 is Correct: Markets tend to work in the interest of the powerful and wealthy. Without regulation, vulnerable groups such as unorganized workers, small farmers, and consumers may be exploited through low wages, unfair prices, or hazardous working conditions. State intervention is required to enforce rules that ensure fairness and social justice.
Statement 3 is Correct: The chain of markets refers to the series of exchanges that goods undergo before reaching the final user. It starts with the producer (e.g., a farmer or factory) and passes through various intermediaries like wholesale traders and retailers. At every link in this chain, buying and selling take place.

Key Takeaway:
State intervention in markets is essential to prevent the exploitation of vulnerable sections, and the market mechanism functions through a continuous chain of buying and selling across multiple intermediaries.

Your note

More from Chapter 6: Law and Social Justice

With reference to the concept of 'Minimum Wages' in India, consider the following 1. The primary objective of the minimum wage law is to ensure that workers are not underpaid by their employers. 2. Once set, the minimum wages remain fixed for a period of ten years to ensure stability. 3. This law is intended to protect the interests of various types of workers, including farm labourers. Which of the statements given above is/are correct?

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In the context of the Indian textile industry, 'Power Looms' are best described as:

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With reference to the role of Workers' Unions, consider the following statements: 1. They allow workers to use combined power to demand better working conditions. 2. They are strictly prohibited by law in the informal sector such as domestic work. 3. They facilitate bargaining for fair wages. Which of the statements given above is/are correct?

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In the framework of governmental functions, which term refers to ensuring that laws enacted by the legislature are implemented and complied with?

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With reference to the Child Labour (Prohibition and Regulation) Amendment Act, 2016, consider the following statements: 1. It bans the employment of children below the age of 14 years only in hazardous occupations. 2. It prohibits the employment of adolescents in hazardous occupations and processes. 3. Violating the ban is a cognizable offence. Which of the statements given above is/are correct?

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The correct option is (c) 2 and 3 only.

Explanation

Statement-wise Analysis:

Statement 1 is Incorrect: Laws are not enacted solely to protect the profit margins of producers. The legal framework aims to regulate relations between workers, producers, and consumers to ensure justice for all parties. For instance, laws exist to ensure minimum wages for workers and safety standards for consumers, often limiting the arbitrary pursuit of profit.
Statement 2 is Correct: Markets tend to work in the interest of the powerful and wealthy. Without regulation, vulnerable groups such as unorganized workers, small farmers, and consumers may be exploited through low wages, unfair prices, or hazardous working conditions. State intervention is required to enforce rules that ensure fairness and social justice.
Statement 3 is Correct: The chain of markets refers to the series of exchanges that goods undergo before reaching the final user. It starts with the producer (e.g., a farmer or factory) and passes through various intermediaries like wholesale traders and retailers. At every link in this chain, buying and selling take place.