Where there is natural monopoly, government is most likely to implement
A) social regulation.
B) antitrust policy.
C) industrial regulation.
D) an externality containment policy.

Question

Quizplus · Accepted Answer

Industrial regulation is the most likely policy to be implemented by the government in a scenario where there is a natural monopoly. This type of regulation is aimed at controlling the prices charged by the monopolist, ensuring fair access to the market, and maintaining quality of service or product. Antitrust policies are not applicable since natural monopolies have no competitors. Social regulation is not relevant in this context as it deals with issues such as health and safety, and environmental standards. An externality containment policy is also not applicable as it is aimed at addressing external costs or benefits associated with production or consumption activities.

Where There Is Natural Monopoly, Government Is Most Likely to Implement