This topic contains a solution. Click here to go to the answer

Author Question: When regulating a natural monopoly, average cost pricing is usually used rather than marginal cost ... (Read 101 times)

sam.t96

  • Hero Member
  • *****
  • Posts: 570
When regulating a natural monopoly, average cost pricing is usually used rather than marginal cost pricing because
 
  A) average cost pricing allows the firm to earn a normal rate of return on investment, while marginal cost pricing leads to economic losses.
  B) average cost pricing is more economically efficient than marginal cost pricing.
  C) average cost pricing leads to lower profits than marginal cost pricing.
  D) average cost pricing leads to a lower market price than marginal cost pricing.

Question 2

The adverse selection problem in international investment means
 
  A) that those seeking funds for the riskiest projects are those most actively seeking the funds.
  B) that the recipients of the funds may use the funds for other than the approved projects.
  C) that government officials may demand higher than the usual amount of bribes.
  D) those in the highest levels of government are the most dishonest.



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

14vl19

  • Sr. Member
  • ****
  • Posts: 310
Answer to Question 1

A

Answer to Question 2

A





 

Did you know?

For about 100 years, scientists thought that peptic ulcers were caused by stress, spicy food, and alcohol. Later, researchers added stomach acid to the list of causes and began treating ulcers with antacids. Now it is known that peptic ulcers are predominantly caused by Helicobacter pylori, a spiral-shaped bacterium that normally exist in the stomach.

Did you know?

Children with strabismus (crossed eyes) can be treated. They are not able to outgrow this condition on their own, but with help, it can be more easily corrected at a younger age. It is important for infants to have eye examinations as early as possible in their development and then another at age 2 years.

Did you know?

Approximately 70% of expectant mothers report experiencing some symptoms of morning sickness during the first trimester of pregnancy.

Did you know?

All patients with hyperparathyroidism will develop osteoporosis. The parathyroid glands maintain blood calcium within the normal range. All patients with this disease will continue to lose calcium from their bones every day, and there is no way to prevent the development of osteoporosis as a result.

Did you know?

When blood is exposed to air, it clots. Heparin allows the blood to come in direct contact with air without clotting.

For a complete list of videos, visit our video library