Exhibit 13-1 Cable television monopolist

As shown in Exhibit 13-1, regulators might follow a fair return pricing strategy and require the cable television monopolist to operate at point:

Question

Exhibit 13-1 Cable television monopolist

As shown in Exhibit 13-1, regulators might follow a fair return pricing strategy and require the cable television monopolist to operate at point:

Quizplus · Accepted Answer

A fair return pricing strategy seeks to ensure that the monopolist earns a fair return on its investment while also ensuring that consumers are not charged excessively high prices. Point C represents the intersection of the firm’s average total cost curve and the demand curve. At this point, the firm earns a fair return on investment, and consumers pay a price that is not considered excessive. Therefore, choice C is the best option.

Exhibit 13-1 Cable Television Monopolist