-The figure above shows the costs and demand curves for the Bigshow Cable Company. Bigshow Cable Company incurs an economic loss if the regulator set its price at
A) $8.
B) $6.
C) $4.
D) None of the above prices force Bigshow to incur an economic loss.

Question

-The figure above shows the costs and demand curves for the Bigshow Cable Company. Bigshow Cable Company incurs an economic loss if the regulator set its price at
A) $8. 
B) $6. 
C) $4. 
D) None of the above prices force Bigshow to incur an economic loss.

Quizplus · Accepted Answer

At a price of $4, the price is below the average total cost, leading to an economic loss.

-The Figure Above Shows the Costs and Demand Curves for the Bigshow