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The price equal to limiting costs, will provide the income, sufficient for a coveringAll costs if average costs of the manufacturer grow together with growth Manufactures. In such situation and really the competition usually provides
Equality of the prices and limiting costs without any intervention of the government.
But if at manufacture growth average costs decrease, in summary Limiting costs appear smaller, than average costs, then the price, Equal to limiting costs, will not provide sufficient for a covering of all Costs of a gain from consumers. For overcoming of this difficulty was It is offered, that the government gave to the enterprises the grants equal
To size on which payments of consumers there is less than size of all costs, and
The government would receive money for grants from tax gathering. Article purpose
"Dispute on limiting costs" was to expose shortcomings of such policy. As there is an uncountable set of products and services, for which Average costs are reduced at manufacture growth, and not all they Are subject to subsidising, the government should solve, what of them Support deserve. Supporters of idea of use of limiting costs as
Bases for pricing have offered the following for the permission of this problem
Procedure: the government (or administration of the enterprises) should count up
The price which consumers will want to pay for that quantity, demand on which
It would be shown at the price equal to limiting costs and if it will appear that
Consumers are ready to pay the sum covering all costs, then
The government should give out to the enterprise a difference between full size
Costs and real receipts from consumers. This procedure is represented to me excentric and conducting to enormous Inefficiencies. It is excentric so far as as, time it is decided that
Consumers will want to pay the sum covering all costs, to it all the same not
Have suggested it to make. It will lead to an inefficiency because, time Consumers should not pay, we have not enough information
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