If a Natural Monopoly Does Not Inflate Its Costs, the Output

question 19

Multiple Choice

If a natural monopoly does not inflate its costs, the output it produces is the smallest when the monopoly is

• A) regulated according to an average cost pricing rule.
• B) regulated according to a marginal cost pricing rule.
• C) regulated to maximise total surplus.
• D) left unregulated.

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Definitions:

Primary Aging

The natural, biological aging process that is genetically programmed and unavoidable, affecting all individuals as they grow older.

Personal Autonomy

The capacity to make an informed, un-coerced decision; typically refers to one's ability to govern oneself or make personal decisions without external coercion.

Independent

Being free from outside control or not depending on another's authority for livelihood or subsistence.

Ageism

A prejudice whereby people are categorized and judged solely on the basis of their chronological age.