-In Figure 27.2,regulation designed to achieve allocative efficient pricing for the natural monopoly will result in a price of

Name: -In Figure 27.2,regulation designed to achieve allocative efficient pricing for the natural monopoly will result in a price of
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The correct answer is A because allocative efficient pricing for a natural monopoly occurs when the price is equal to the marginal cost of production, which is P_A in Figure 27.2.