Customers are most likely buying from a natural monopoly when they purchase
A) aspirin from a generic drug company.
B) a laptop computer from Sony.
C) a glass of water from the local water company.
D) all of the above.

Question

Quizplus · Accepted Answer

A natural monopoly occurs when a single firm can supply a product to an entire market at a lower cost than two or more firms. Local water companies often have this characteristic due to the high infrastructure costs and efficiencies of scale.

Customers Are Most Likely Buying from a Natural Monopoly When