10, Dec 2020
effective government response to a natural monopoly’s tendency to produce less output at a higher cost than the socially optimal quantity?

Which of the following is an effective government response to a natural monopoly’s tendency to produce less output at a higher cost than the socially optimal quantity?

A. A per-unit subsidy

B. A patent

C. A lump-sum subsidy and price ceiling

D. Antitrust legislation

E. A per-unit tax