If the government wants a natural monopolist to achieve allocative efficiency,the government should
A) Subsidize the firm and require marginal cost pricing.
B) Ensure that the firm produces at full capacity.
C) Regulate the firm so that it produces the output level at which economic profit is zero.
D) Use price ceilings so the firm will earn a normal profit.
Correct Answer:
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Q26: To maximize profit,a natural monopolist produces the
Q27: The long-run average total cost curve of
Q28: Market failure occurs in natural monopolies because
A)The
Q29: Marginal cost pricing means that a firm
Q30: An unregulated natural monopoly is most likely
Q32: A major drawback of providing subsidies to
Q33: If a natural monopoly is forced to
Q34: For a natural monopoly,marginal cost
A)Intersects average total
Q35: Natural monopolies fail to minimize
A)Marginal cost.
B)Marginal revenue.
C)Average
Q36: If the government forces a natural monopoly
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