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 22 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?

Street names for barbiturates include reds, red devils, yellow jackets, blue heavens, Christmas trees, and rainbows. They are commonly referred to as downers.

Did you know?

The average human gut is home to perhaps 500 to 1,000 different species of bacteria.

Did you know?

Essential fatty acids have been shown to be effective against ulcers, asthma, dental cavities, and skin disorders such as acne.

Did you know?

Dogs have been used in studies to detect various cancers in human subjects. They have been trained to sniff breath samples from humans that were collected by having them breathe into special tubes. These people included 55 lung cancer patients, 31 breast cancer patients, and 83 cancer-free patients. The dogs detected 54 of the 55 lung cancer patients as having cancer, detected 28 of the 31 breast cancer patients, and gave only three false-positive results (detecting cancer in people who didn't have it).

Did you know?

Excessive alcohol use costs the country approximately $235 billion every year.

The coagulation cascade. Both the intrinsic pathway and extrinsic pathway lead to a common pathway ... The coagulation cascade. Both the intrinsic pathway and extrinsic pathway lead to a common pathway ...
A roller cell-type electric fuel pump. A roller cell-type electric fuel pump.
A funnel helps in hearing if the electric fuel pump inside the gas tank is working. A funnel helps in hearing if the electric fuel pump inside the gas tank is working.
An H-bridge circuit is used to control the direction of the DC electric motor of the electronic ... An H-bridge circuit is used to control the direction of the DC electric motor of the electronic ...
Some of the pathways of the auditory system that lead from one ear to the cortex. Some of the pathways of the auditory system that lead from one ear to the cortex.
When operating your own business, it is wise to know your cost of capital and that of the ... When operating your own business, it is wise to know your cost of capital and that of the ...
Video: Dissociative Disorders (Part 3)

For a complete list of videos, visit our video library