Author Question: Under rate-of-return regulation, the price is set so that A) price equals the marginal cost of ... (Read 92 times)

serike · **on:** Jun 29, 2018

Under rate-of-return regulation, the price is set so that

A) price equals the marginal cost of production.
B) the firm earns a positive economic profit.
C) the firm earns a monopoly profit.
D) the firm earns a normal rate of return on investment.

Question 2

In the above figure, this profit-maximizing monopolistic competitive firm will realize an economic profit of

A) -1,400.
B) 2,100.
C) 1,400.
D) 700.