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Question
The reason an unregulated natural monopolist will produce at an economically inefficient quantity is
A) due to the fact that the monopolist will equate marginal cost with price to determine the output level.
B) due to the fact that the monopolist will equate average total cost with price to determine the output level.
C) that the price does not equal the true marginal cost of producing the good.
D) that the monopolist will produce a quantity greater than the minimum of the average total cost curve.
Answer
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