Natural monopolies are characterized by facing a(n)________.
A) horizontal demand curve
B) constant average cost curve
C) declining average cost curve
D) increasing average cost curve

Question

Quizplus · Accepted Answer

Natural monopolies are characterized by a declining average cost curve, which means that as they produce more, the average cost of producing each additional unit decreases. This is often due to high fixed costs and low variable costs, allowing these monopolies to benefit from economies of scale.

Natural Monopolies Are Characterized by Facing A(n)________