About the regulating monopoly

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Regulating Monopoly. Explain how a regulator can reduce the deadweight loss associated with monopoly by setting a price cap in the market. Show what the ideal level of this price cap is, and the resulting inefficiency. Will this same strategy work for regulating natural monopoly? If so, explain why; if not, explain what strategy would work to reduce deadweight loss.

Reference no: EM13733618

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