The Outcome of Regulating a Natural Monopoly Using the Marginal

question 89

Multiple Choice

The outcome of regulating a natural monopoly using the marginal cost pricing rule is

• A) that the firm makes a normal profit.
• B) that the firm maximizes its profit.
• C) that consumer surplus is less than what it would be if the firm maximized its profit.
• D) an efficient level of production.
• E) that the firm makes an economic profit.

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Definitions:

U.S. Firms

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