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britt138 britt138
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A year ago

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.

Short description: A graph plots quantity against price in dollars per kilowatts hour. Long description: The horizontal axis representing quantity ranges from 1.0 to 1.5 in millions. The vertical axis representing price in dollars per kilowatts hour ranges from 0.06 to 0.12. The graph plots two lines and two curves. The curve, LRAC passes through the following points: (1.0, 0.11), (1.4, 0.09), and (1.5, 0.08). The curve, MC passes through the following points: (1.0, 0.06) and (1.5, 0.07). The line, D passes through the following points: (1.0, 0.12), (1.4, 0.09), and (1.5, 0.08). The line, MR passes through the following points: (1.0, 0.06), and (1.2, 0). The curve, MC intersects the line, MR and line, D at points (1.0, 0.06) and (1.5, 0.07). The curve, LRAC intersects the line, D at the point at (1.4, 0.09). Note: all values are approximate.

FIGURE 12-8

Refer to Figure 12-8. Suppose this firm is being regulated using a pricing policy of average-cost pricing. In this case, economic profits are equal to



▸ $10 000.

▸ $6000.

▸ $126 000.

▸ $0.

▸ $28 000.
Textbook 
Microeconomics

Microeconomics


Edition: 17th
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sbe0921sbe0921
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britt138 Author
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A year ago
Thank you, thank you, thank you!
Roselalo
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Yesterday
this is exactly what I needed
byehoe
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2 hours ago
Good timing, thanks!
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