What is the usual rationale for governments to issue monopoly-promoting licenses to firms providing services such as trash collection?
A) lower risk for investors in the firms
B) increased customer choice
C) better-quality services
D) economies of scale
E) public safety

Question

Quizplus · Accepted Answer

The usual rationale for governments to issue monopoly-promoting licenses to firms providing services such as trash collection is economies of scale. By limiting the number of providers, the government can ensure that the firm has sufficient customers to achieve economies of scale, which can lead to lower costs and, ultimately, lower prices for consumers. This approach can also ensure that the services provided are standardized and meet certain quality standards.

What Is the Usual Rationale for Governments to Issue Monopoly-Promoting