In July 2008, the Federal Communications Commission approved the merger of satellite radio providers XM Satellite and Sirius Satellite Radio, establishing a single satellite radio company in America. If the new company was a natural monopoly, which of the following would be a regulation to ensure an efficient quantity of satellite radio service?

Question

Quizplus · Accepted Answer

The marginal cost pricing rule ensures that the price is set equal to the marginal cost of production, leading to an efficient allocation of resources and quantity of service.

In July 2008, the Federal Communications Commission Approved the Merger