When a regulatory agency uses rate of return regulation, the
A) agency is able to eliminate the deadweight loss.
B) firm's managers have an incentive to inflate the firm's costs.
C) regulated firm's profit must be maximized for the market to be efficient.
D) regulated firm must receive a government subsidy.
E) the agency is using a form of marginal cost pricing.
B
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The theory of expected utility theory
A) predicts all actions involving uncertainty. B) predicts no actions involving uncertainty. C) predicts some, but not all, actions involving uncertainty. D) predicts only one in three actions involving uncertainty.
The difference between the existing unemployment rate and the natural unemployment rate is defined is the __________ unemployment rate.
a. frictional b. structural c. cyclical d. natural
The payoff matrix shows the outcome for only one player in a game situation.
Answer the following statement true (T) or false (F)
Marginal Cost is
A. the per unit fixed cost of production. B. the addition to cost associated with one additional unit of output. C. the per unit cost of production. D. the per unit variable cost of production.