If the Government Requires a Natural Monopoly to Price at Marginal

question 9

Multiple Choice

If the government requires a natural monopoly to price at marginal cost,

• A)monopoly firms will earn zero economic profits because the price of the good equals the cost of producing that good.
• B)monopoly firms will operate at a loss because P < AC.
• C)more firms will be able to enter the market.
• D)producer surplus will increase because quantity supplied is greater.

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Definitions:

Learned Helplessness

A psychological condition in which a person has learned to believe they are powerless in a particular situation, often as a result of repeated failure or inability to control outcomes.

Unsolvable Problems

Issues or challenges that cannot be resolved or fixed, often leading to feelings of frustration or helplessness.

Aversive Training

A behavioral training technique that involves using unpleasant stimuli to discourage undesirable behaviors.

Avoidance

A behavioral response aimed at evading an unpleasant, harmful, or threatening situation.