The Rail System in Metropolis Is a Natural Monopoly

question 71

Multiple Choice

The rail system in Metropolis is a natural monopoly.If the government regulates the system by setting the fare equal to marginal cost, which of the following will be true?

• A)Profit will be zero under regulation.
• B)Only normal profit will be earned under regulation.
• C)Accounting profit will be zero under regulation.
• D)Economic loss will occur under regulation.
• E)Profit will be higher than if the monopoly were unregulated.

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Definitions:

Euglenoids

A diverse group of single-celled organisms belonging to the kingdom Protista, characterized by their flexible cell membranes and the presence of a flagellum.

Chlorophyll A

A primary photosynthetic pigment found in plants and cyanobacteria, responsible for absorbing light to provide energy for photosynthesis.

Multicellular

Pertains to organisms composed of more than one cell, exhibiting cellular differentiation and specialization.

Nonvascular

Plants or organisms that do not have vascular tissues for transporting water and nutrients.