A natural monopoly is producing an output level of 1,000 units per day. If the monopoly is broken up into 5 firms, then average total cost for each of the 5 firms
a. will exceed the monopolist's average total cost
b. will equal the monopolist's average total cost
c. will fall below the monopolist's average total cost
d. may equal or fall below the monopolist's average total cost
e. may equal or exceed the monopolist's average total cost
A
You might also like to view...
Define money and list its functions
What will be an ideal response?
Credit cards are considered to be money because they facilitate exchange
a. True b. False
In a society with market failure, there
a. is no pollution b. are no public goods c. is an inefficient allocation of resources d. are no markets e. is no need for a government
The U.S. Postal Service has a monopoly on the delivery of first-class mail due to
a. economies of scale. b. a lack of initiative on the part of competing firms. c. legal barriers limiting entry. d. control over an essential resource.