Exhibit 9.1

-Refer to Exhibit 9.1,which shows the long-run average cost of a firm.The downward-sloping long-run average cost curve indicates the firm is _____
A)a technological monopoly.
B)a natural monopoly.
C)a government-created monopoly.
D)an economic monopoly.
E)a geographic monopoly.

Question

Exhibit 9.1
 
-Refer to Exhibit 9.1,which shows the long-run average cost of a firm.The downward-sloping long-run average cost curve indicates the firm is _____
A)a technological monopoly. 
B)a natural monopoly. 
C)a government-created monopoly. 
D)an economic monopoly. 
E)a geographic monopoly.

Quizplus · Accepted Answer

The downward-sloping long-run average cost curve indicates that the firm is a natural monopoly, which means that it is the most efficient method of production due to economies of scale and barriers to entry for potential competitors.

Exhibit 9.1 -Refer to Exhibit 9.1,which Shows the Long-Run Average Cost of Long-Run