A market in which the economies of scale are so great that the largest firm has the lowest costs and is able to drive out competitors is called a(n)

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In a natural monopoly, economies of scale are so great that the largest firm has the lowest costs and is able to drive out competitors, resulting in a market with only one dominant firm. This is a market failure because it restricts competition and leads to reduced consumer surplus. It is not an externality, which is an unintended cost or benefit arising from a market transaction, or a deregulated industry, which has fewer government regulations.

A Market in Which the Economies of Scale Are So