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NemiM [27]
3 years ago
8

If the government regulates a natural monopolist to produce the allocatively efficient level of output, it will require the mono

polist to set a price that is:
a. equal to its marginal cost and grant a subsidy to cover the loss

b. equal to its average total cost and levy a tax on the excess profit

c. greater than its marginal cost and levy a tax on the excess profit

d. greater than its marginal cost but that minimizes the deadweight loss

e. greater than its average total cost but that minimizes the deadweight loss
Business
1 answer:
jasenka [17]3 years ago
8 0

Answer:

a. equal to its marginal cost and grant a subsidy to cover the loss

Explanation:

In a competitive market there is allocative efficiency non fixing of prices.

The price of commodity is equal to it's marginal cost.

A socially optimal level of output is produced thereby demand will equal marginal cost.

A monopolist however will not set price that is equal to marginal cost normally. Instead they will less goods at a higher cost and charge higher price on it.

If a government wants to regulate a monopoly the best option will be for the monopolist to set a price equal to its marginal cost and government grant a subsidy to cover the loss

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4 years ago
The hard sell or aggressive persuasion designed to separate consumers from their cash emerged during the _____ answer a: industr
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3 years ago
A salesperson who has anticipated customer doubt about a product and formulated proper responses is ready to:____.
galina1969 [7]

After a salesperson has been able to anticipate customer doubt about a product and then formulated a response to it, the salesperson is then ready to Answer objections.

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5 0
2 years ago
If the dollar buys fewer bananas in Honduras than in Guatemala, then traders could make a profit by
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Answer:

The correct answer is C)

Explanation:

Given that the price for bananas is cheaper in Guatemala, suppliers will be driven to make a quick profit just by buying from the Guatemalan market to sell in the Honduras economy.

This, however, will cause the prices of bananas to rise in Guatemala. Because, according to the basic principles of economics, the higher the demand the higher the price.

Cheers!

8 0
3 years ago
At​ Frank's Delicatessen, Frank noticed that the elasticity of customers differed in the short and longer term. Frank also notic
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Answer:

C. Negative; Positive

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If soda and sandwiches are complementary goods, then the cross price elasticity between them is negative. Negative cross price elasticity indicates that an increase in the price of soda would result in a fall in the quantity demand for sandwiches. On the other hand, a decrease in the price of soda would result in an increase in the quantity demanded for sandwiches.

If yogurt and sandwiches are substitute goods which means that yogart can be used in place of sandwiches or sandwiches can be used in place of yogurt. The cross price elasticity between the substitute goods is positive. Positive cross price elasticity indicates that an increase in the price of yogurt would result in an increase in the quantity demanded for sandwiches. On the other hand, a decrease in the price of yogurt would result in a fall in the quantity demanded for sandwiches.

5 0
4 years ago
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