This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: If Michigan's electric utilities were allowed to use marginal cost pricing, it would lead to ... (Read 24 times)

Hungry!

  • Hero Member
  • *****
  • Posts: 1,071
on: Jun 29, 2018
If Michigan's electric utilities were allowed to use marginal cost pricing, it would lead to economic profits for these utilities. Is the previous statement correct or incorrect? Explain your answer.
 
  What will be an ideal response?

Question 2

The used car market has a significant amount of adverse selection because
 
  A) the seller knows more about the car than the buyer.
  B) the buyer can easily find out more about the car than the seller.
  C) buyers and sellers rarely have enough information.
  D) the transaction costs of the used car market are prohibitive.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

marict

  • Sr. Member
  • ****
  • Posts: 304
Reply #1 on: Jun 29, 2018
Answer to Question 1

The statement is incorrect. Imposing marginal cost pricing on natural monopolies results in the firms incurring economic losses not economic profits.

Answer to Question 2

A


Hungry!

  • Hero Member
  • *****
  • Posts: 1,071
Reply #2 on: Jun 29, 2018
Thank you :)


marict

  • Sr. Member
  • ****
  • Posts: 304
Reply #3 on: Jun 29, 2018
Happy to help you


« previous next »
 

Did you know?

There are 60,000 miles of blood vessels in every adult human.

Did you know?

Computer programs are available that crosscheck a new drug's possible trade name with all other trade names currently available. These programs detect dangerous similarities between names and alert the manufacturer of the drug.

Did you know?

According to the Migraine Research Foundation, migraines are the third most prevalent illness in the world. Women are most affected (18%), followed by children of both sexes (10%), and men (6%).

Did you know?

Despite claims by manufacturers, the supplement known as Ginkgo biloba was shown in a study of more than 3,000 participants to be ineffective in reducing development of dementia and Alzheimer’s disease in older people.

Did you know?

It is believed that the Incas used anesthesia. Evidence supports the theory that shamans chewed cocoa leaves and drilled holes into the heads of patients (letting evil spirits escape), spitting into the wounds they made. The mixture of cocaine, saliva, and resin numbed the site enough to allow hours of drilling.

Engine and electric motor for the Toyota Prius Engine and electric motor for the Toyota Prius
This graphic illustrates the original systems model of politics advanced by David Easton. Politics This graphic illustrates the original systems model of politics advanced by David Easton. Politics
Electric Eel Electric Eel
A typical electric cooling fan assembly after being removed from the vehicle. A typical electric cooling fan assembly after being removed from the vehicle.
An exploded view of a gerotor electric fuel pump. An exploded view of a gerotor electric fuel pump.
Downward Spiral of Poverty and Hunger Lack of food can lead to numerous other symptoms Downward Spiral of Poverty and Hunger Lack of food can lead to numerous other symptoms
Video: Stroke volume - contractility definition

For a complete list of videos, visit our video library