A Marginal Cost Pricing Rule Sets Marginal Cost Equal to

question 307

Multiple Choice

A marginal cost pricing rule sets marginal cost equal to

• A) minimum average variable cost.
• B) price.
• C) average cost.
• D) marginal revenue.
• E) the smaller of price or marginal revenue.

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Definitions:

Lessen Competition

Strategies or situations that reduce the intensity of rivalry among existing competitors in a market.

Monopolization

The possession of monopoly power in the relevant market and the willful acquisition or maintenance of that power, as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident.

Antitrust Law

Encompasses regulations that prohibit unfair, anti-competitive practices and monopolistic behavior in the marketplace.

Market Power

The ability of a company or entity to control price or exclude competitors within a specific market.