Under an Average-Cost Pricing Policy,a Local Water Company Will Face

Multiple Choice

Under an average-cost pricing policy,a local water company will face which of the following?

A) The local water company chooses the price at which short-run average cost curve intersects the average.
B) The local water company chooses the price at which long-run average cost curve intersects the average.
C) The government chooses the price at which the demand curve intersects the short-run marginal-cost curve
D) The government chooses the price at which the demand curve intersects the long-run average-cost curve.