Producers of artificially scarce goods face _____ that are similar to those of natural monopolists;they decline over the relevant range of output.

Question

Quizplus · Accepted Answer

The concept of declining average total costs over the relevant range of output applies to natural monopolies, where the fixed costs are high and it becomes cheaper per unit to produce more output. Similarly, artificially scarce goods are typically produced with high fixed costs, leading to declining average total costs over the relevant range of output. Therefore, the correct answer is D) average total costs.

Producers of Artificially Scarce Goods Face _____ That Are Similar