Which Is the Most Valid Criticism of the Regulation of Natural

question 135

Multiple Choice

Which is the most valid criticism of the regulation of natural monopolies and other firms subject to regulation by regulatory commissions?

• A)It is difficult to find enough honest people to serve on regulatory commissions.
• B)Such regulation is unnecessary and amounts to creeping socialism.
• C)Many members of such commissions are appointed rather than being elected.
• D)Regulated firms may have little incentive to contain costs since they are assured a "fair" return above costs.

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Definitions:

M/D/1

A notation in queue theory representing a system with a single server, where arrivals are Markovian (Poisson process), service times are deterministically fixed, and there is one server.

Constant Service Time

A condition in queuing theory where the time required to serve each customer is the same and does not vary.

Units Arrive

Pertains to the process or moment when manufactured goods or inventory items reach a designated location, such as a warehouse.

M/M/1 Assumptions

A set of conditions that underlie the M/M/1 queue model, including that arrivals occur according to a Poisson process, service times have an exponential distribution, there is a single server, and the queue has infinite capacity.