A Basic Problem with Public Regulation Is That

A basic problem with public regulation is that

A) regulatory agencies exist at the state but not the federal level of government and therefore lack power.
B) it is difficult to decide what constitutes a fair rate of return.
C) it inevitably expands so that ultimately all production is nationalized.
D) regulatory commissions set only minimum prices that regulated firms can charge, thus promoting excessive entry of new firms into regulated markets.
E) regulation requires that modestly staffed government agencies make the day-to-day operating decisions of regulated firms.

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