If government regulation sets the maximum price for a natural monopoly equal to its marginal cost, then the natural monopolist will
a. earn economic losses.
b. earn economic profits.
c. earn zero economic profits.
d. produce a lower quantity of output than is socially optimal.
a
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How can we separate the cost of the electricity that generates the heat from a light bulb and the cost of the electricity that generates that same bulb's light?
A) By comparing the wattage of the bulb with the change in air temperature B) By distinguishing sunk costs from marginal costs C) By dividing the total cost in two D) We cannot do it in any defensible way.
An airline can profit by offering standby customers an unsold seat at a substantial discount just before takeoff because
A. additional passengers are needed to balance the load. B. the marginal cost of additional passengers is very small. C. additional passengers add little to fixed costs. D. such passengers add more to profits than do those with reserved seats.
Any amount that a bank chooses to keep on hand beyond what it is required to is called:
A. extra holdings. B. excess reserves. C. federal funds. D. excess deposits.
What can a nation do to increase its economic growth? Why is economic growth among the major national economic goals of all countries?
What will be an ideal response?