The Following Figure Shows the Average Cost [AC],marginal Cost [MC],and

question 46

Multiple Choice

The following figure shows the average cost [AC],marginal cost [MC],and demand [D] curves for a natural monopoly;Qi denotes quantity and Pi denotes price.
Figure 15-3
-Refer to Figure 15-3.If the firm practices marginal-cost pricing,the equilibrium price would be _____.

• A)P₁
• B)P₂
• C)P₃
• D)P₄

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Definitions:

Increase in Supply

A situation where the quantity of a product that producers are willing and able to sell at various prices rises, often due to factors like technological advancements or decreased production costs.

Quantity Supplied

The total number of units of a good or service that sellers are willing and able to sell at a particular price over a specified period.

Point A to B

A phrase commonly used to describe the process or path taken from one position or situation to another, often implying a change in state or location.

Price of Oranges

The amount of money required to purchase a specific quantity of oranges in a given market.