When regulators require that a natural monopoly sets price equal to average total cost:
a. it is said to be allowing a fair rate of return.
b. the firm earns a super normal profit.
c. the firm shuts down permanently.
d. the firm operates at the profit-maximizing level of output.
e. the firm shuts down temporarily.
a
Economics
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The public education system is an example of
A) an income maintenance program. B) a negative income tax. C) the poor paying more than the market price for a service they receive. D) a subsidized service.
Economics
If the government wants to regulate a natural monopoly, it will force the firm to set price equal to
A) average cost. B) marginal cost. C) marginal revenue. D) None of the above.
Economics