Question

what is regulation in an economic system?
regulation is the placing of limits or restrictions on business activity by the government.
regulation is the placing of limits or restrictions on business activity by producers.
regulation is the removal of limits or restrictions on business activity by the government.
regulation is the removal of limits or restrictions on business activity by producers.

Explanation:

In an economic system, regulation is government - imposed limits on business. Producers don't regulate in this sense. Removal of limits is deregulation.

Answer:

Regulation is the placing of limits or restrictions on business activity by the government.