The main problem with imposing the socially optimal price (P = MC) on a monopoly is that

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The main problem with imposing the socially optimal price (P = MC) on a monopoly is that the socially optimal price:

a. May be so low that the regulated monopoly can’t break even.

b. May cause the regulated monopoly to engage in price discrimination.

c. May be higher than the monopoly price

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Microeconomics Principles, Problems and Policies

ISBN: 978-1259450242

20th edition

Authors: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn

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Question Posted: Apr 24, 2018 05:38 AM

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The main problem with imposing the socially optimal price (P = MC) on a monopoly is that

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Microeconomics Principles, Problems and Policies

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