Consider a regulated natural monopoly. If the regulatory commission wants to establish a fair-return price, then it should set a price ceiling where the demand curve crosses the monopoly's long-run:

In the long run which of the following is true?

A) There are no fixed costs. B) The size of a firm's physical plant can be changed but the firm cannot adopt new technology. C) The firm can vary its explicit costs but not its implicit costs. D) Total cost = fixed cost + variable cost.

The marginal propensity to consume rises as the absolute level of income increases

Indicate whether the statement is true or false