If there are strong economies of scale and scope, then society
A)will not be able to prevent overt collusion.
B)will benefit from establishing a cartel.
C)cannot benefit from regulation of a natural monopoly.
D)will not be able to preserve free competition.

Question

Quizplus · Accepted Answer

Strong economies of scale and scope often lead to natural monopolies, where a single firm can produce at a lower cost than multiple competing firms. This makes it difficult to maintain free competition.

If There Are Strong Economies of Scale and Scope, Then