Asked by
Quadri Popoola
on Dec 12, 2024
Verified
A natural monopoly is defined as an industry in which one firm
A) can produce the entire industry output at a lower average cost than a larger number of firms could.
B) can produce the entire industry output at a lower marginal cost than a larger number of firms could.
C) is very large relative to other firms that could enter the industry.
D) can earn higher profits if it is the only firm in the industry rather than if other firms also enter the industry.
Natural Monopoly
A market condition where a single firm can supply a product or service at a lower cost than any potential competitor, often due to economies of scale.
Marginal Cost
The outlay for making one more unit of a product or service.
- Comprehend the fundamental principles of monopoly, encompassing demand, revenue, and cost frameworks.
Verified Answer
KH
Learning Objectives
- Comprehend the fundamental principles of monopoly, encompassing demand, revenue, and cost frameworks.