Adverse selection in competitive insurance markets harms

A natural monopoly

A) faces more competition after regulation. B) might exaggerate its costs if it is regulated using rate of return regulation. C) might falsely minimize its costs if it is regulated using rate of return regulation. D) might falsely minimize its costs if it is regulated using a marginal cost pricing rule. E) is allowed to maximize its profit under a marginal cost pricing rule.

The quantity theory of money argues that, in the long run, the percentage change in money will create an equal percentage change in

A) velocity. B) real GDP. C) potential GDP. D) the price level.