Regulatory Lag Refers to

question 157

Multiple Choice

Regulatory lag refers to

• A)the fact that most regulated firms are slow to change their structures of production.
• B)the fact that most regulated firms are slow to respond to their customers' preferences.
• C)the time period between when a natural monopoly's costs change and when the regulatory agency adjusts prices for the natural monopoly.
• D)the time period between when natural monopoly begins to produce its output and when it sells its product.
• E)none of the above

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Definitions:

Compound Interest

The accumulation of money that builds over time in an investment or interest-bearing account as new interest is earned on previous interest that is not withdrawn.

Savings Account

A deposit in a commercial bank or thrift institution on which interest payments are received; generally used for saving rather than daily transactions; a component of the M2 money supply.

Interest Rate

The percentage at which interest is paid by a borrower for the use of money that they borrow from a lender.

Present Value

The current valuation of a future financial sum or sequence of cash flows, using a defined rate of return for calculation.