Catalina Cable Company (CCC)faces a Demand for Basic Cable Service

Catalina Cable Company (CCC) faces a demand for basic cable service given by P = 160 - Q.It has total costs (exclusive of the required rate of return on its invested capital) of TC = 250 + Q².If the commission that regulates CCC determines that $500 is sufficient to compensate equity holders for their invested capital,what are the regulated price and output?

A) P = 85, Q = 75.
B) P = 75, Q = 85.
C) P = 65, Q = 95.
D) P = 55, Q = 105.
E) P = 45, Q = 115.