A local electricity-generating company has a monopoly that is protected by an entry barrier that takes the form of
A) control of a key raw material.
B) network externalities.
C) economies of scale.
D) perfectly inelastic demand curve.

Question

Quizplus · Accepted Answer

Economies of scale create a barrier to entry because they make it difficult for new firms to enter the market and compete with established firms.

A Local Electricity-Generating Company Has a Monopoly That Is Protected