Which of the following is least likely to be a natural monopoly?
A)subway services
B)electric utilities
C)water and sewer services
D)taxicab service
E)cable television services

Question

Quizplus · Accepted Answer

Taxicab service is least likely to be a natural monopoly because there can be multiple providers within a given geographical area. Another factor that makes it less likely to be a natural monopoly is that entry barriers are relatively low, as anyone can become a taxi driver with a license and a vehicle. On the other hand, subway services, electric utilities, water and sewer services, and cable television services are industries where it is common for one company to provide service to an entire area, making them more likely to be natural monopolies.

Which of the Following Is Least Likely to Be a Natural