Question

How is government both a consumer and producer in respect of its relationships in business​

Answer 1

Answer:

The government is a producer of goods/services that are then usually not subject to market transactions. Some goods/services that the government produce can be said to increase directly the utility of the households/individuals in the economy.

Answer 2

Government is both a consumer and producer in respect of its relationship with businesses as it provides funds to businesses and uses their end products.

Explanation:

1. The government provides cheap raw materials and assistance to businesses. In this manner it is a producer of the goods and services.
2. The government also invest in various businesses acting as a producer. The government can directly as well as indirectly affect the operations of a business.
3. Moreover, the goods and services produced by the businesses are also used by governmental agencies for carrying out their functions. The government is also a consumer of products made by businesses.