Price regulation for Enrodes which is a monopoly provider of residential electricity in a region of northern Michigan.
Enrodes is a monopoly provider of residential electricity in a region of northern Michigan. Total demand by its 2 million households is Q4 = 1,000 P, and Enrodes can produce electricity at a constant marginal cost of $2 per megawatt hour. Consumers in this region of Michigan have recently complained that Enrodes is charging too much for its services. In fact, a few consumers are so upset that they are trying to form a coalition to lobby the local government to regulate the price Enrodes charges. If all the consumers of this region joined the coalition against Enrodes, describe how much would each customer be willing to spend to lobby the local government to regulate Enrodes price? Do you think the consumers will be successful in their efforts? describe.