-Refer to the Above Figure

question 283

Multiple Choice

-Refer to the above figure. Regulators cannot force natural monopolies to operate in the long run at a loss. Therefore, they usually require the firms to charge a price equal to

• A) marginal cost, which is P1.
• B) marginal cost, which is P2.
• C) average cost, which is P3.
• D) average cost, which is P4.

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Definitions:

Predicting

The act of making educated guesses or forecasts about future events based on current or past information.

Future

A time period that is yet to come and the events or conditions that will happen in that time.

Jean-Baptiste Lamarck

An early 19th-century French biologist known for his theory of inheritance of acquired characteristics, a precursor to Darwin’s theory of evolution.

Spontaneously

Occurring without apparent external cause or intervention, often used to describe natural phenomena or processes.