Regulations that permit a regulated firm to cover its costs and to make a normal level of profit are commonly referred to as

Question

Quizplus · Accepted Answer

Cost-plus regulation allows a firm to cover its costs and make a normal level of profit by setting prices that reflect the firm's costs plus a standard profit margin. This approach is often used in industries where companies are natural monopolies, such as utilities.

Regulations That Permit a Regulated Firm to Cover Its Costs