If the Marginal Cost Pricing Rule Is Used to Regulate

question 190

Multiple Choice

If the marginal cost pricing rule is used to regulate a natural monopolist, the monopolist

• A) earns an economic profit.
• B) earns a normal profit.
• C) sustains an economic loss.
• D) earns a monopoly profit.

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Definitions:

Cognitive Dissonance

The psychological discomfort experienced when holding two or more contradictory beliefs, values, or attitudes, leading to motivation for change to reduce the dissonance.

Boring Task

A monotonous or uninteresting activity that requires completion.

Festinger

Refers to Leon Festinger, a psychologist known for the theory of cognitive dissonance, which explores the discomfort felt when holding conflicting beliefs, values, or attitudes.

Cognitive Dissonance

A state of psychological discomfort arising from holding two or more conflicting beliefs, values, or attitudes simultaneously.