If a natural monopoly does not inflate its costs, the output it produces is the smallest when the monopoly is
A) left unregulated.
B) regulated according to an average cost pricing rule.
C) regulated according to a marginal cost pricing rule.
D) regulated to maximize total surplus.
A
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In the short run,
a. at least one of the firm's inputs is fixed b. customer tastes and preferences are fixed c. the firm may vary all inputs d. sunk costs are variable e. government intervention is inevitable
The Japanese keiretsu is an example of a(n) ________.
A. Mform of organization B. Uform of organization C. mixed design D. network organization
Suppose that a regulatory agency has imposed marginal cost pricing on a natural monopolist. We expect that
A) the firm will earn only a normal profit. B) the firm's average total cost of production is rising over the relevant range of production. C) the firm will rise its price above marginal cost. D) the firm will earn economic losses.
All markets involve buyers and sellers engaging in exchange.
Answer the following statement true (T) or false (F)