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Suppose the government price-regulates a monopoly. If rationing is observed in the market, what would be a reasonable change in the regulation? Decrease the maximum
Suppose the government price-regulates a monopoly. If rationing is observed in the market, what would be a reasonable change in the regulation? Decrease the maximum price that the monopolist can charge. Increase the maximum price that the monopolist can charge. Eliminate all price regulation. No policy change is needed, as rationing is irrelevant for price regulation
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