Policymakers Are Discussing Various Proposals Regarding How to Deal with Natural

Policymakers are discussing various proposals regarding how to deal with natural monopolies.Transportation Minister Gaston wants to regulate natural monopolies by equating price with average total cost.Gaston contends that such a policy will ensure that monopolies make every effort to reduce costs.Finance Minister Chen wants the government to own natural monopolies.Chen argues that government-owned monopolies usually do a better job of holding down costs than privately owned monopolies.Which Minister's argument is correct

A) Transportation Minister Gaston's argument
B) Finance Minister Chen's argument
C) both ministers' arguments
D) neither minister's argument

Correct Answer:

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