Figure 912 Figure 9

Multiple Choice

Figure 9.12 Figure 9.12 shows the cost and demand curves for the ETSA.
-Refer to Figure 9.12.Why won't regulators require that ETSA Power produce the economically efficient output level?

A) Because there is insufficient demand at that output level
B) Because at the economically efficient output level, the marginal cost of producing the last unit sold exceeds the consumers' marginal value for that last unit
C) Because Erickson Power will earn zero profit
D) Because Erickson Power will sustain persistent losses and will not continue in business in the long run