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If a Contestable Market Has Only One Seller, Which of the Following

Question 175

Multiple Choice

If a contestable market has only one seller, which of the following will keep the seller from producing inefficiently and charging a price that generates long-run economic profits?


A) government regulations
B) low costs of entry into and exit from the market
C) substantial economies of scale that provide a competitive advantage to large firms in such markets
D) the threat of a government takeover of the firms in these markets

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