Question

1.

The goal of antitrust laws is to

Group of answer choices

Control the structure of an industry only.

Prevent monopolies from forming.

Control the structure of an industry and alter industry behavior.

Alter industry behavior only.

2.

Profit regulation occurs when regulation requires the natural monopolist to set

Group of answer choices

Price equal to average total cost.

Marginal revenue equal to average total cost.

Price equal to average variable cost.

Price equal to marginal cost.

3.

Profit regulation of a natural monopoly is achieved when

Group of answer choices

P = ATC.

MR = MC.

P = MC.

MR = minimum ATC.

Answer 1

Answer : 1) The answer is option C.

Antitrust law's main purpose is controlling the industry structure and controlling the behaviour of alter industry. Therefore, option C is correct.

2) The answer is option A.

For natural monopolist the profit regulation occur when price is equal to the average total cost. Because the profit regulation permit the natural monopolist to charge that price level which covers all costs and make normal profit. Firms earn normal profit when price is equal to average total cost. Therefore, option A is correct.

3) The answer is option A.

For natural monopolist the profit regulation occur when price is equal to the average total cost. Because the profit regulation permit the natural monopolist to charge that price level which covers all cost and make normal profit. Firms earn normal profit when price is equal to the average total cost. Therefore, option A is correct.