An Average Cost Pricing Rule Sets ________ Equal to Average

question 91

Multiple Choice

An average cost pricing rule sets ________ equal to average total cost.An average cost pricing rule is not an efficient way of regulating monopoly because at the quantity produced,________.

• A)price;marginal benefit exceeds marginal cost
• B)the return on capital;marginal benefit exceeds marginal cost
• C)marginal cost;marginal cost exceeds marginal benefit
• D)price equal to marginal revenue,which in long-run equilibrium is;marginal cost exceeds marginal benefit
• E)marginal cost;marginal benefit exceeds marginal cost

---

Definitions:

Variable Cost

Costs that vary directly with the level of production or output, such as raw materials and direct labor expenses.

Decision Making

The cognitive process of selecting a course of action from among multiple alternatives.

Product Costs

The costs directly associated with producing goods, including direct materials, direct labor, and manufacturing overhead.

Financial Reporting

The method of generating reports that reveal a company's fiscal condition to its management, investors, and governmental bodies.