Which activity would be considered the BEST method to regulate natural monopolies?
A) enforcing the marginal cost pricing rule and public subsidies
B) using an average cost pricing rule
C) setting an acceptable rate of return
D) no regulation

Question

Quizplus · Accepted Answer

Enforcing the marginal cost pricing rule and providing public subsidies can help ensure that prices reflect the true cost of production while maintaining the financial viability of the monopoly, making it an effective method to regulate natural monopolies.

Which Activity Would Be Considered the BEST Method to Regulate