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

Author Question: What are a marginal cost pricing rule and an average cost pricing rule? What are the disadvantages ... (Read 146 times)

olgavictoria

  • Hero Member
  • *****
  • Posts: 528
on: Jun 29, 2018
What are a marginal cost pricing rule and an average cost pricing rule? What are the disadvantages and advantages of each?
 
  What will be an ideal response?

Question 2

Your textbook discusses dry counties in the U.S. What is a dry county?
 
  A) A county where rainfall is below the national average
  B) A county that experiences no rainfall
  C) A county in which it is illegal to produce, purchase and sell alcohol
  D) A county in which only dry gin is consumed


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

l.stuut

  • Sr. Member
  • ****
  • Posts: 345
Reply #1 on: Jun 29, 2018
Answer to Question 1

Natural monopolies can be regulated using a marginal cost pricing rule, so that the firm must set its price equal to its marginal cost, or by using an average cost pricing rule, so that the firm must set its price equal to its average total cost. The advantage of the marginal cost pricing rule is that the resulting output is efficient; the disadvantage is that the firm suffers an economic loss. The advantage of the average cost pricing rule is the firm earns zero economic profit; the disadvantage is that it produces an inefficient quantity of output.

Answer to Question 2

C


olgavictoria

  • Member
  • Posts: 528
Reply 2 on: Jun 29, 2018
:D TYSM

amandanbreshears

  • Member
  • Posts: 320
Reply 3 on: Yesterday
Excellent

« previous next »
 

Did you know?

Though the United States has largely rejected the metric system, it is used for currency, as in 100 pennies = 1 dollar. Previously, the British currency system was used, with measurements such as 12 pence to the shilling, and 20 shillings to the pound.

Did you know?

Patients should never assume they are being given the appropriate drugs. They should make sure they know which drugs are being prescribed, and always double-check that the drugs received match the prescription.

Did you know?

In ancient Rome, many of the richer people in the population had lead-induced gout. The reason for this is unclear. Lead poisoning has also been linked to madness.

Did you know?

GI conditions that will keep you out of the U.S. armed services include ulcers, varices, fistulas, esophagitis, gastritis, congenital abnormalities, inflammatory bowel disease, enteritis, colitis, proctitis, duodenal diverticula, malabsorption syndromes, hepatitis, cirrhosis, cysts, abscesses, pancreatitis, polyps, certain hemorrhoids, splenomegaly, hernias, recent abdominal surgery, GI bypass or stomach stapling, and artificial GI openings.

Did you know?

Fungal nail infections account for up to 30% of all skin infections. They affect 5% of the general population—mostly people over the age of 70.

Change in Emotional States During Adolescence Average emotional state becomes teadilyi more negativ Change in Emotional States During Adolescence Average emotional state becomes teadilyi more negativ
Advantages and DisAdvantages of Radiant super-heater Advantages and DisAdvantages of Radiant super-heater
How to find the derivatives of trigonometric functions using the chain rule (Part 2) How to find the derivatives of trigonometric functions using the chain rule (Part 2)
Overallocation of Labor to Farming When Farmworkers Are Paid Their Average Product Overallocation of Labor to Farming When Farmworkers Are Paid Their Average Product
Average Distribution of Incoming Solar Radiation Average Distribution of Incoming Solar Radiation
Find the derivative using the product rule Find the derivative using the product rule
Video: HIV Infection: Viral life cycle

For a complete list of videos, visit our video library