A Major Problem with Regulatory Agencies Is That They

Multiple Choice

A major problem with regulatory agencies is that they

A) have no real legal power over the industries they are supposed to regulate.
B) tend to be too tough on the firms they are regulating, forcing them into a loss position.
C) often underestimate the firm's cost of production and consequently force regulated firms into a loss position.
D) often come to represent the interests of established firms in the industry and use their power to limit competition.