The result of regulatory capture is that government price regulation can often become a way for existing competitors to work together to
A) reduce output.
B) limit competition.
C) keep prices high.
D) all of the above.

Question

Quizplus · Accepted Answer

Regulatory capture occurs when a regulatory agency, created to act in the public interest, instead advances the commercial or political concerns of the industry it is charged with regulating. This can lead to outcomes where regulations serve the interests of existing firms, such as reducing output, limiting competition, and keeping prices high, to the detriment of consumers and potential new entrants.

The Result of Regulatory Capture Is That Government Price Regulation