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.
a
You might also like to view...
Suppose a home owner is selling their home and they are aware that the basement has a severe drainage problem and the potential buyers do not have this information. This is an example of ________.
A) screening B) the principal-agent problem C) self-revelation D) asymmetric information
The Treasury also implements monetary policy
Indicate whether the statement is true or false
A reduction in the number of farms in the United States has caused food production to fall
Indicate whether the statement is true or false
Table 11-1 Quantity (units)18161412104Price per unit (dollars)123 4 5 6 Total cost (dollars)44 3832262014Table 11-1 shows demand and total cost schedules for Monopoliteria. At its profit-maximizing level of output, Monopoliteria’s profit is
A. $10. B. $15. C. $22. D. $30.