If we compare regulating a natural monopoly using a marginal cost pricing rule to using an average cost pricing rule, we see that output is
A) greater with marginal cost pricing, but average cost pricing allows for costs to be covered.
B) the same under both cases, but the profit is greater with average cost pricing.
C) greater under average cost pricing, but profits are greater with marginal cost pricing.
D) the same but profits are greater with marginal cost pricing.
E) greater with marginal cost pricing, and the firm's profit is larger with marginal cost pricing.
A
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Farmers can use their land to grow soy beans or corn. If the price of corn rises,
A) the supply of soybeans decreases and the soybean supply curve shifts leftward. B) the supply of soybeans increases. C) the supply of corn increases and the corn supply curve shifts rightward. D) the supply of corn increases.
What does monetary policy do?
(A) It mints new coins and prints bills. (B) It changes the way that taxes are collected. (C) It alters the supply of money. (D) It charters new banks.