Electric Utilities Sometimes Charge Higher Prices for Electricity Used for Illumination

question 74

Multiple Choice

Electric utilities sometimes charge higher prices for electricity used for illumination and lower prices for electricity used for heat.These lower prices for electric heat result primarily from:

• A) the existence of good heating substitutes.
• B) economies of scale in electric heat generation.
• C) prices for electric heat being set at the socially optimal level.
• D) strict government regulation of the price charged for electric heat.

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