The Government of Your State Wants Gigantic Software Corp

question 42

Multiple Choice

The government of your state wants Gigantic Software Corp., which is a natural monopoly, to stay in business yet still produce where price equals marginal cost.The government might choose to

• A)set a price ceiling 10 percent lower than its previous level
• B)impose a tax on the company for each dollar of sales
• C)establish regulations that raise the company's cost of doing business
• D)provide a subsidy to the company to cover the loss and ensure a normal profit
• E)replace the company's top management

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Definitions:

Df

Short for Degrees of Freedom, it represents the number of independent pieces of information available to estimate another piece of information.

F-Ratio

A statistical value used to compare variances in analyses of variance (ANOVA), indicating the ratio of systematic variance to error variance.

Factor B

Factor B usually represents a variable or an element in an experiment that is manipulated to observe its effect on an outcome, distinguishable from Factor A.

MSB

Mean Square Between; a term used in ANOVA to describe the average of squared differences between group means and the overall mean.