political campaign manager must decide whether to

Political campaign manager must decide whether to

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4.A certain town in a country obtains all of its electricity from one company, SouthElectric. Although the company is a monopoly, it is owned by the citizens of the town, allof whom split the profits equally at the end of each year. The CEO of the company claimsthat because all of the profits will be given back to the citizens, it makes economic senseto charge a monopoly price for electricity. Do you agree with the CEO? Why or Whynot? If the gains of the producers from monopoly power could be redistributed toconsumer, would the social cost of monopoly power be eliminated? What are theimportant measures you suggest to control monopoly power?
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  • Winter '15
  • nagendra

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