As a Policy Option for Regulating Natural Monopoly,marginal Cost Pricing

question 24

Multiple Choice

As a policy option for regulating natural monopoly,marginal cost pricing is desirable because

• A)consumers pay the lowest possible price that will generate sufficient revenue to cover the costs of the natural monopolist.
• B)allocative efficiency is achieved.
• C)price is set equal to minimum long-run average cost.
• D)all of the above.

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Definitions:

Actual Threats

Genuine risks or dangers that have the potential to cause harm or damage.

Persuasion Process

The act or method of influencing someone's beliefs, attitudes, intentions, motivations, or behaviors through argument, reasoning, or appeal.

Asch's Studies

A series of experiments led by Solomon Asch in the 1950s demonstrating the power of conformity in groups, where individuals often agreed with incorrect majority opinions.

Standard Line

Often refers to a commonly accepted benchmark or norm within a given context, such as manufacturing, testing, or evaluating outcomes.