Which of the following is most likely to be a natural monopoly?
A) aircraft manufacturing
B) auto manufacturing
C) electric utilities
D) steel production

Question

Quizplus · Accepted Answer

Electric utilities are most likely to be a natural monopoly because they require significant capital investment, have high fixed costs, and it is more efficient to have one provider serving a particular geographical region. This is because the duplication of infrastructure by multiple firms would result in higher costs and inefficiencies. In contrast, aircraft manufacturing, auto manufacturing, and steel production can be operated by multiple firms without significant inefficiencies.

Which of the Following Is Most Likely to Be a Natural