Briefly Explain Regulation in the Case of a Natural Monopoly

question 25

Essay

Briefly explain regulation in the case of a natural monopoly. Provide 3 common examples of regulation. Briefly discuss the benefits of privatization set out in the text and explain what is required for privatization of a nationalized asset in order for privatization to work well.

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Definitions:

Taxed

The imposition of a financial charge or other levy upon a taxpayer by a governmental organization in order to fund government spending and various public expenditures.

Double Taxation

A taxation principle referring to income taxes that are paid twice on the same source of income, common in C-type corporations where income is taxed at both the corporate and shareholder levels.

Corporate

Relating to a large company or group of companies authorized to act as a single entity.

Proprietorship

A business structure where the enterprise is owned and run by one person, with no legal distinction between the owner and the business.