Economic regulation includes all of the following EXCEPT
A) regulations on the level of profit.
B) cost-plus regulation.
C) price setting with normal profit.
D) setting the cost of production.
E) quantity setting with appropriate subsidies.

Question

Quizplus · Accepted Answer

Economic regulation does not typically involve setting the cost of production, as this is generally left up to individual producers to determine based on market conditions and their own cost structures. Instead, economic regulation typically focuses on setting prices, quantities, or profit levels to ensure that markets operate in the most efficient and socially optimal manner possible. While cost-plus regulation and price setting with normal profit are both forms of economic regulation that involve setting prices, quantity setting with appropriate subsidies is not a common form of economic regulation, as it involves direct intervention in the quantity of goods or services produced rather than the pricing mechanisms that determine how those goods and services are allocated.

Economic Regulation Includes All of the Following EXCEPT