In public policy and consumer protection, regulatory policies protect consumers primarily by performing which of the following functions?

Introduction / Context:
This question belongs to the field of economics and public policy. Governments use different kinds of policies for different purposes. Regulatory policies are designed to set rules for businesses and other organisations so that consumers, workers and the environment are protected from harmful practices. Understanding what regulatory policy actually does helps you separate it from other tools such as monetary policy, fiscal policy and social welfare programmes.

Given Data / Assumptions:
- The focus is on regulatory policies and how they protect consumers.
- The options mention money supply, public assistance, oversight of business and taxation and government spending.
- We assume a standard classification of policies: monetary policy, fiscal policy, regulatory policy and social policy.
- The question requires identifying the function that best describes regulatory policy in relation to consumer protection.

Concept / Approach:
Regulatory policy involves setting rules and standards for how businesses may operate, what information they must disclose and what practices are prohibited. Examples include product safety standards, labelling requirements, limits on pollution, rules against deceptive advertising and controls on prices in certain sectors. By overseeing and limiting business behaviour, regulatory policy aims to prevent harm and ensure fair treatment for consumers. In contrast, controlling the money supply is monetary policy, deciding how to tax and spend is fiscal policy and providing public assistance falls under social welfare policy. Therefore, the option that talks about overseeing and limiting business practices best captures the consumer protection role of regulatory policy.

Step-by-Step Solution:
Step 1: Recall that regulatory policy is mainly about rules and regulations imposed on firms and industries. Step 2: Compare each option with this idea. Option C explicitly mentions overseeing and limiting business practices, which fits the description. Step 3: Recognise that controlling the money supply (option A) describes central bank monetary policy, not direct consumer protection rules. Step 4: Notice that public assistance (option B) and taxation and spending (option D) belong to social and fiscal policy rather than to regulatory policy. Step 5: Select option C as the correct description of how regulatory policies protect consumers.

Verification / Alternative check:
To verify, think of examples such as regulations requiring food companies to list ingredients and expiry dates, rules that banks must follow when disclosing loan terms and regulations that limit how much a company can pollute. All these are about scrutinising and restricting business practices for the sake of consumer and public welfare. None of them directly decide interest rates or how government budgets are allocated. This distinction confirms that regulatory policies protect consumers by overseeing and limiting business behaviour.

Why Other Options Are Wrong:
Option A: Controlling the supply of money is the job of monetary policy, typically managed by the central bank, and is aimed at controlling inflation and growth, not directly at consumer protection through business rules.
Option B: Providing public assistance programmes is a form of social policy aimed at income support and welfare, not regulation of business practices.
Option D: Deciding how to tax and spend money is fiscal policy, used for macroeconomic management and redistribution, rather than for setting detailed rules for companies.

Common Pitfalls:
A common mistake is to confuse all government actions under a single label and to assume that any policy affecting consumers must be regulatory. Another pitfall is focusing on keywords such as "money" or "tax" and choosing those options without linking them to the correct type of policy. To avoid this, remember the basic mapping: monetary policy equals money supply and interest rates, fiscal policy equals taxation and spending, regulatory policy equals rules for business behaviour and social policy equals welfare and assistance programmes.

Final Answer:
Regulatory policies protect consumers primarily by overseeing, guiding and limiting business practices so that firms follow rules that safeguard public and consumer interests.