-A firm operating as a natural monopoly would be most likely identified by which panel inExhibit J-1?
A) Panel 1
B) Panel 2
C) Panel 3
D) Panel 4
E) Panel 5

Question

-A firm operating as a natural monopoly would be most likely identified by which panel inExhibit J-1?
A) Panel 1 
B) Panel 2 
C) Panel 3 
D) Panel 4 
E) Panel 5

Quizplus · Accepted Answer

Panel 3 is characteristic of a natural monopoly, where average total costs decrease over the relevant range of output, indicating economies of scale that make a single producer more efficient than multiple competitors.

-A Firm Operating as a Natural Monopoly Would Be Most