Which of the following was NOT an advantage of privatisation?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. Reduced competition.
Reduced competition was not an advantage of privatization. In fact, privatization typically aims to increase competition by introducing market forces and encouraging private sector efficiency. By transferring state-owned enterprises to private ownership, it often promotes a competitive environment, improving service quality and reducing costs. However, if privatization leads to monopolies or limited competition (such as when only a few firms dominate), it can harm consumers by limiting choice and driving up prices. Therefore, reduced competition is a potential disadvantage, not an advantage, of privatization.