Choose the two BEST ways to regulate a natural monopoly. A)
The government should not get involved so that free market demand and
supply is established.
B)
The government should impose a price ceiling at fair returns price so that
the monopoly can cover costs.
The government should impose a tax on these big business entities to
decrease price and decrease their output.
D)
The government should impose a per unit tax on output so that consumers
will offset the costs for the supplier.
E)
The government should impose a price ceiling at the socially optimal price
and subsidize any loss to cover costs.