One way that natural monopolies are typically regulated is
a. by setting a price that makes economic profit zero.
b. by forcing the firm to set price equal to marginal cost
c. by setting a price that gives owners a "fair rate of return"
d. by forcing the firm to set price equal to minimum average total cost
e. by setting a price that maximizes the firm's economic profit
C
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Refer to the above data. We can infer that, at zero output, this firm's total fixed, total variable, and total costs are
A. zero, zero, and zero, respectively. B. zero, $25, and $175, respectively. C. $150, $25, and $175, respectively. D. $150, zero, and $150, respectively.
A regulated natural monopolist allowed to earn a "fair" rate of return would produce to the point at which
A. the price per unit equals its marginal revenue. B. the price per unit equals the long-run average cost. C. the marginal revenue curve meets the long-run average cost curve. D. the marginal revenue curve meets the long-run marginal cost curve.