Refer to the information provided in Figure 13.8 below to answer the question that follows. 
Figure 13.8 Refer to Figure 13.8. The only firm producing electricity has the long-run average total cost curve shown. The total amount of demand for kilowatts is 100,000 per hour. It makes economic sense for this firm to be the only producer of electricity because this firm
A. must have control over a scarce factor of production.
B. must have a patent on the production process necessary to produce electricity.
C. must be realizing economies of scale in producing electricity.
D. must have a government franchise to produce electricity.
Answer: C
You might also like to view...
Suppose farmers in a given market can either grow soy beans or corn on their land. In addition, suppose an increase in the demand for corn causes the price of corn to increase. As a result of the increase in the price of corn, farmers who were already growing corn will earn an:
A. economic loss in the short run. B. economic profit in the long run. C. economic loss in the long run. D. economic profit in the short run.
In today's world, many countries impose tariffs
A) only on imports. B) only on exports. C) on both imports and exports. D) on imports, exports, and nontraded goods.
A profit-maximizing firm should spend an additional dollar on advertising so long as this expenditure results in more than one dollar of:
a. additional sales. b. reduced costs. c. increased profits. d. demand.
If Sophia's tax liability increases from $10,000 to $15,000 when her income increases from $30,000 to $40,000, her marginal tax rate is
a. 33 percent. b. 35 percent. c. 50 percent. d. 60 percent.