Natural monopolies are the natural result of:
A)competition in markets where economies of scale exist over the relevant range of output.
B)geographical happenstance.
C)fierce competition from firms in a market.
D)government regulations intended to encourage competition.

Question

Quizplus · Accepted Answer

Natural monopolies occur in markets where economies of scale exist over the relevant range of output, meaning that a single firm can produce the total output at a lower cost per unit than could multiple firms. This makes it inefficient for multiple firms to operate, leading to a monopoly situation naturally.

Natural Monopolies Are the Natural Result Of