Which of the following is TRUE of a natural monopoly?
A) Its long-run average cost curve slopes upward as it intersects the demand curve.
B) Economies of scale exist to only a very low level of output.
C) Economies of scale allow one firm to supply the entire market at the lowest possible cost.
D) The firm is not protected by any barrier to entry.
C
You might also like to view...
Using real GDP on the horizontal axis instead of real disposable income implies that a marginal propensity to consume 0.75 generates for every additional $100 of real GDP
A) $25 of additional saving. B) $56.25 of additional consumption spending. C) $25 of additional saving and taxes. D) $75 of additional real disposable income.
When planned aggregate expenditure is larger than real GDP, actual inventories ________ planned inventories and real GDP ________
A) are more than; decreases B) are more than; increases C) are less than; increases D) are not related to; increases E) are less than; decreases
The U.S. government establishing a policy that it will bail out troubled financial institutions and a resulting increase in the number of bank failures is an example of: a. the moral hazard problem
b. the free rider problem. c. the adverse selection problem. d. the "lemon" problem.
A government-imposed price floor in the tobacco market will raise the value of land used to grow tobacco
Indicate whether the statement is true or false