The Diagram Below Shows Cost and Revenue Curves for a Natural

Multiple Choice

The diagram below shows cost and revenue curves for a natural monopoly producing electricity.Price is dollars per kilowatt hour and quantity is kilowatt hours per day. FIGURE 12-7
-Refer to Figure 12-7.Suppose this firm is being regulated using a policy of marginal-cost pricing.The resulting price and output would be ________ per kwh and ________ kwh per day.

A) $0.06; 1 million
B) $0.07; 1.5 million
C) $0.08; 1.5 million
D) $0.09; 1.4 million
E) $0.12; 1 million