Cost-of-service regulation allows regulated companies to charge prices that
A) reflect the cost of regulating the industry, plus the marginal cost of the product.
B) allow monopoly profits to the producer.
C) reflect the actual average cost of providing the services to the customer.
D) are determined by competition in other geographic markets.
C
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Refer to Figure 9.1. Assume the economy is initially at point A. The initial change from a shock that increases investment expenditure is best represented by which short-run equilibrium combination of price level and real GDP?
A) P2; Y2 B) P3; Y2 C) P1; Y2 D) P2; Y1
Which of the following would NOT be an example of a technological change?
A. Google develops a new way to perform Internet searches that makes searches produce more relevant results. B. A team of nuclear scientists develop a new way of generating nuclear power that is safer than the older methods but is more expensive to implement. C. The government passes a law expanding the funding available to NASA and other agencies concerned with the advancement of basic science. D. A pharmaceutical company develops a new drug that effectively fights malaria.