Under an average-cost pricing policy,a local water company will face which of the following?

Question

Quizplus · Accepted Answer

Under an average-cost pricing policy, especially in the context of utilities like water companies, the government often sets prices based on where the demand curve intersects the long-run average-cost curve. This approach aims to ensure that prices reflect the cost of providing the service over the long term, promoting efficiency and covering costs without generating excessive profits.

Under an Average-Cost Pricing Policy,a Local Water Company Will Face