Policymakers Are Discussing Various Proposals Regarding How to Deal with Natural

question 575

Multiple Choice

Policymakers are discussing various proposals regarding how to deal with natural monopolies. Senator Huff wants to regulate natural monopolies by equating price with average total cost. Huff contends that such a policy will ensure that monopolies make every effort to reduce costs. Senator Puff wants the government to own natural monopolies. Puff argues that government-owned monopolies usually do a better job of holding down costs than privately owned monopolies. Which senator's argument is correct?

• A)Senator Huff
• B)Senator Puff
• C)both senators
• D)neither senator

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Definitions:

Limitation of Damages

A legal principle that restricts the amount of compensation an injured party can receive.

Lessee

A lessee is a person or entity who rents land, a building, or an apartment under a lease agreement.

Unconscionable

Refers to a contract or deal that is so unjust or overwhelmingly one-sided in favor of one party that it is deemed unfair or unethical.

Breach of Contract

Failure by one or more parties to fulfill the terms and conditions of a contract, which could lead to legal action for enforcement or damages.