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Question 175

Multiple Choice

Figure 9.12 Figure 9.12 Figure 9.12 shows the cost and demand curves for the ETSA. -Refer to Figure 9.12.ETSA Power is a natural monopoly because A) it is a power company and all power companies are natural monopolies. B) average total cost is still declining when it intersects demand. C) of its continually declining marginal revenue curve as output rises. D) its marginal cost lies entirely below its long-run average cost. Figure 9.12 shows the cost and demand curves for the ETSA.
-Refer to Figure 9.12.ETSA Power is a natural monopoly because


A) it is a power company and all power companies are natural monopolies.
B) average total cost is still declining when it intersects demand.
C) of its continually declining marginal revenue curve as output rises.
D) its marginal cost lies entirely below its long-run average cost.

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