A Natural Monopolist That Is Price-Regulated at the Marginal Cost

Multiple Choice

A natural monopolist that is price-regulated at the marginal cost output level will:

A) produce the optimal level of output and earn a normal profit.
B) eventually incur losses if MC is less than ATC.
C) be producing at the same output and price that an unregulated natural monopolist would choose.
D) produce the optimal level of output and earn an economic profit greater than zero.