A change in the price of a good leads to a change in the demand of the good.
Answer the following statement true (T) or false (F)
False
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The above figure shows the demand for cable and the cable company's cost of providing cable
a. What price and quantity will be produced if the company is unregulated and profit maximizes? b. What price and quantity will be produced if the company is regulated using the marginal cost pricing rule? c. What is the advantage of the marginal cost pricing rule? d. What price and quantity will be produced if the company is regulated using the average cost pricing rule? e. What is the advantage of the average cost pricing rule?
The production of paper creates pollution, an external cost. What happens to the production of paper if the government imposes a tax on paper producers equal to the marginal external cost of the pollution?
What will be an ideal response?