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Use the Figure Below to Answer the Following Questions

Question 86

Multiple Choice

Use the figure below to answer the following questions.
Use the figure below to answer the following questions. Figure 13.5.2 -Consider the natural monopoly depicted in Figure 13.5.2. If a regulatory agency sets a price just sufficient for the firm to make zero economic profit, and if the firm inflates its costs as much as possible, the regulated price will be A) P₀. B) P₁. C) P₂. D) P₃. E) either P₀ or P₃.
Figure 13.5.2
-Consider the natural monopoly depicted in Figure 13.5.2. If a regulatory agency sets a price just sufficient for the firm to make zero economic profit, and if the firm inflates its costs as much as possible, the regulated price will be


A) P₀.
B) P₁.
C) P₂.
D) P₃.
E) either P₀ or P₃.

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