The Economic Efficiency of a Natural Monopoly Can Be Improved

question 79

Multiple Choice

The economic efficiency of a natural monopoly can be improved with the use of two- part tariffs because it allows the monopoly to

• A) charge users according to their willingness to pay.
• B) lower its total costs.
• C) charge residential users different rates than business users.
• D) charge users according to their ability to pay.
• E) charge users separately for fixed and variable costs.

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