If a government does not regulate a natural monopoly, it may be because the government:
A) does not feel that natural monopolies are very important.
B) is too busy.
C) believes that there may be competition from potential substitutes.
D) thinks that the monopoly is behaving itself.

Question

Quizplus · Accepted Answer

Natural monopolies may not be regulated if the government believes there is potential competition from substitutes, which can provide alternative options for consumers and possibly keep the monopoly's power in check.

If a Government Does Not Regulate a Natural Monopoly, It