A Natural Monopoly That Is Not Regulated Will Choose to Produce

question 208

Multiple Choice

A natural monopoly that is not regulated will choose to produce at the

• A) minimum point of the long-run average cost curve.
• B) point at which marginal cost is above average total cost.
• C) point at which the demand curve intersects the long-run average cost curve.
• D) point at which marginal revenue equals marginal cost.

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Definitions:

Corporation

A firm that is authorized by statute to act as a legal entity separate and distinct from its owners (shareholders).

Federal Courts

Courts established by the federal government of a country, which have jurisdiction over matters outlined in the federal constitution.

Independent System

A system that operates autonomously, without dependence on external systems or factors, often used in the context of power grids or computing.

Judicial Review

The process by which courts evaluate the legality of legislative and executive actions, ensuring they comply with the constitution.