What methods that the governments use to regulate prices charged by natural monopolies?How effecetive are they

Question

need the answer ASAP!
-plz n thankyou

Answer 1

We have regulatory quangos in Britain like Ofwat (for water) and Ofgas (for gas). They intervene quite effectively to protect the consumer and to chivvy suppliers with penalties into doing things they otherwise wouldn't (like fix water leaks). See for example the annual reports of Thames Water http://www.thames-water.com/UK/region/en_gb/content/General/General_001287.jsp?SECT=General_001287 .

Answer 2

What you are pointing to is the direction President Nixon took in the early-1970s, before the Arab oil embargo. This drastic step may be back in play, but with an understanding that this oil embargo has never ceased....this is a marketplace where those who produce the product control the price by manipulating the amount which reaches the market.

Answer 3

Natural monopolies are extremely, extraordinarily, unbelievably RARE.

Monopolies exist because of government regulations. Government does not prevent them.

I sincerely hope a teacher did not give you that question.

.

Answer 4

price ceilings. they are effective to the point that uh.....the price is regulated.

or the government can set the price, or they can force fair-return, or socially optimal