In October 2002, Duke Power, the regulated electricity utility of the United States (US) corporation Duke Energy, agreed to pay $25 million to its customers to settle allegations by regulators in North and South Carolina that it had underreported net earnings by about $123 million between 1998 and 2002. The underreporting of net earnings by Duke Energy was allegedly undertaken in order to avoid having to cut its electricity rates.
Required:
Explain what is meant by the term 'economic consequences' and relate this to the underreporting of net earnings by Duke Energy.

Question

Quizplus · Accepted Answer

The Answer of In October 2002, Duke Power, the regulated electricity utility of the United States (US) corporation Duke Energy, agreed to pay $25 million to its customers to settle allegations by regulators in North and South Carolina that it had underreported net earnings by about $123 million between 1998 and 2002. The underreporting of net earnings by Duke Energy was allegedly undertaken in order to avoid having to cut its electricity rates.
Required:
Explain what is meant by the term 'economic consequences' and relate this to the underreporting of net earnings by Duke Energy.

In October 2002, Duke Power, the Regulated Electricity Utility of the United