Q7. A regulatory commission that seeks to have regulated companies set prices at a level that provides a reasonable profit to the companies is utilizing which of the following methods of regulation?

A)   Cost-of-service regulation.

B)   Social regulation.

C)   Rate-of-return regulation.

Q8. In general, the regulatory body of an industry with a natural monopoly will attempt to set industry prices at which point on the supply/demand curve?

A)   Marginal revenue = average cost.

B)   Marginal revenue = marginal cost.

C)   Average cost = demand.

Q9. When a firm operates with the lowest cost per unit and the capacity to produce all of the industry’s output, this economic structure is best described as:

A)   an oligopoly.

B)   a competitive monopoly.

C)   a natural monopoly.

答案和详解如下：

Q7. A regulatory commission that seeks to have regulated companies set prices at a level that provides a reasonable profit to the companies is utilizing which of the following methods of regulation?

A)   Cost-of-service regulation.

B)   Social regulation.

C)   Rate-of-return regulation.

Correct answer is C)

Rate-of-return regulation seeks to allow industry participants to receive what regulators determine is a normal or fair return on their investment.

Q8. In general, the regulatory body of an industry with a natural monopoly will attempt to set industry prices at which point on the supply/demand curve?

A)   Marginal revenue = average cost.

B)   Marginal revenue = marginal cost.

C)   Average cost = demand.

Correct answer is C)

At the point where average cost equals demand, producers would maintain profitability and consumers would pay a price somewhat lower than in an unregulated market.

Q9. When a firm operates with the lowest cost per unit and the capacity to produce all of the industry’s output, this economic structure is best described as:

A)   an oligopoly.

B)   a competitive monopoly.

C)   a natural monopoly.

Correct answer is C)

A natural monopoly is characterized by a single dominant firm within the industry that is the lowest cost producer and has sufficient capacity to meet demand.

thanks !~

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