A Natural Monopoly Regulated with a Marginal Cost Pricing Rule

question 450

Multiple Choice

A natural monopoly regulated with a marginal cost pricing rule results in

• A) an economic loss for the regulated firm.
• B) an economic profit for the regulated firm.
• C) a normal profit for the regulated firm.
• D) a deadweight loss.

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Definitions:

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A wheeled motor vehicle used for transporting passengers, which also carries its own engine or motor.