Regulation that is based upon the cost of providing the good or service is known as

Question

Quizplus · Accepted Answer

Cost-of-service regulation is a regulatory approach that establishes prices for goods or services based on the cost of producing and delivering them. This approach allows regulated firms to earn a fair return on their investments and covers both fixed and variable costs of providing the good or service. By setting prices based on costs, cost-of-service regulation ensures that consumers are charged fair prices and that firms have adequate incentives to invest in the quality and quantity of service provided.

Regulation That Is Based Upon the Cost of Providing the Good