In product markets where the economies of scale are so large that only one firm can make a profit in that product in world markets, that firm is said to exploit ______.

Question

Quizplus · Accepted Answer

When only one firm can make a profit in a product market due to large economies of scale, it leads to a situation of monopoly. This allows the firm to charge higher prices and earn greater profits, which are known as monopoly rents. Therefore, the best choice is B, monopoly rents.

In Product Markets Where the Economies of Scale Are So