« previous next »

Author Question: When electric utilities are regulated using an average cost pricing rule, they will earn zero ... (Read 69 times)

Jkov05

  • Hero Member
  • *****
  • Posts: 556
on: Jun 29, 2018
When electric utilities are regulated using an average cost pricing rule, they will earn zero economic profit. Is the previous statement correct or incorrect? Why?
 
  What will be an ideal response?

Question 2

The value of the marginal product of labor is given by:
 
  A) the ratio of the marginal product of labor to the wage rate.
  B) the product of the marginal product of labor and the wage rate.
  C) the ratio of the marginal product of labor to the price of the final good produced.
  D) the product of the marginal product of labor and the price of the final good produced.


AISCAMPING

  • Sr. Member
  • ****
  • Posts: 347
Reply #1 on: Jun 29, 2018
Answer to Question 1

The statement is correct. An average cost pricing rule requires that the firm set its price equal to its average total cost. When price equals average total cost, the firm earns zero economic profit.

Answer to Question 2

D


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Approximately one in three babies in the United States is now delivered by cesarean section. The number of cesarean sections in the United States has risen 46% since 1996.

Did you know?

Human neurons are so small that they require a microscope in order to be seen. However, some neurons can be up to 3 feet long, such as those that extend from the spinal cord to the toes.

Did you know?

Inotropic therapy does not have a role in the treatment of most heart failure patients. These drugs can make patients feel and function better but usually do not lengthen the predicted length of their lives.

Did you know?

The most dangerous mercury compound, dimethyl mercury, is so toxic that even a few microliters spilled on the skin can cause death. Mercury has been shown to accumulate in higher amounts in the following types of fish than other types: swordfish, shark, mackerel, tilefish, crab, and tuna.

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.

On average, students in Roman Catholic schools score higher on national tests than students in ... On average, students in Roman Catholic schools score higher on national tests than students in ...
Average Years of Schooling versus GDP per Capita Average Years of Schooling versus GDP per Capita
Finding the derivative using the power rule - Solutions Finding the derivative using the power rule - Solutions
Find the derivative using the product rule Find the derivative using the product rule
Are these the correct answers for finding the derivative using the power rule? Are these the correct answers for finding the derivative using the power rule?
Use the product rule to find derivative Use the product rule to find derivative
Video: Cleavage and Implantation Animation

For a complete list of videos, visit our video library