The Public Interest Theory of Regulation Stipulates That Government Regulation

Multiple Choice

The public interest theory of regulation stipulates that government regulation of a natural monopoly is necessary in order to achieve all of the following, except

A) preventing the natural monopoly from harming society through its monopoly pricing.
B) garnering for society at least part of the cost reductions from being a natural monopoly.
C) avoiding the reduction in output associated with monopoly power.
D) eventually breaking up the monopoly to achieve competition within the industry.