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Price-cap regulation is a form of incentive regulation capping the prices that firms in a natural monopoly position may charge their customers. Designed in the 1980s by UK Treasury economist Stephen Littlechild, it has been applied to all privatised British network utilities.
Price-cap regulation was developed in the 1980s by British Treasury economist Stephen Littlechild and was gradually incorporated globally into monopoly regulations. Price-cap regulation adjusts firm prices according to a price cap index which reflects the inflation rate in the economy generally, efficiencies a specific firm is able to utilize ...
The setting of price controls in the form of price-cap regulation or rate-of-return regulation, especially for natural monopolies. Where there is non-compliance, this can result in: Financial penalties; or; A de-licensing process through which an organization or person, if judged to be operating unsafely, is ordered to stop or suffer a penalty.
A related government intervention to price floor, which is also a price control, is the price ceiling; it sets the maximum price that can legally be charged for a good or service, with a common example being rent control. A price ceiling is a price control, or limit, on how high a price is charged for a product, commodity, or service.
The price cap must receive official approval from the transmission, generation and distribution companies that supply the grid, as well as the O.K. from federal regulators.
Revenue-cap regulation allows the operator to change its prices within baskets of services so long as the change in revenue does not exceed the revenue cap index. This index typically reflects the overall rate of inflation in the economy, the inflation in the operator's input prices relative to the average firm in the economy and the ability of the operator to gain efficiencies relative to the ...
According to a spokesperson for AstraZeneca, both privately insured and uninsured patients will be eligible for the $35 price cap, which will apply to all of the inhalers the drugmaker sells in ...
However, if you want a lower price-to-earnings (P/E) multiple—less than 16.0x for the VXUS—and a potential missing piece to your S&P 500-heavy portfolio, I have no issue with picking up this ...