Which of the Following Is a Major Shortcoming of Government

question 177

Multiple Choice

Which of the following is a major shortcoming of government regulation of business monopoly?

• A) The regulators often estimate production costs incorrectly and thus force firms into loss positions.
• B) The regulators often come to represent the interests of the established firms and use their power to limit competition.
• C) The regulators usually permit firms to make unusually high accounting profits.
• D) The regulators, acting in consumers' interests, often force prices so low that even with efficient production techniques the regulated firms lose money.

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Definitions:

Price Utility

The perceived value or satisfaction a consumer derives from purchasing a product at a given price.

Internet Users

Individuals who access and use the internet through various devices for information, communication, entertainment, or other purposes.

Prescription Medications

Medically authorized drugs that require a healthcare professional's approval before they can be obtained by a patient.

Marketplace

A venue, physical or digital, where buyers and sellers interact to exchange goods, services, or information.