A natural monopoly occurs when:
A. long-run average costs decline continuously through the range of demand.
B. a firm owns or controls some resource essential to production.
C. long-run average costs rise continuously as output is increased.
D. economies of scale are obtained at relatively low levels of output.
Answer: A
You might also like to view...
Of the following U.S. demographic groups, which tends to have the highest rate of unemployment?
A) whites B) blacks C) white teenagers D) black teenagers
The first term in an NPV calculation is usually
A) positive, because firms consider only positive returns. B) positive, because interest charges do not accrue until the second period. C) zero, because interest charges do not accrue until the second period. D) negative, because funds for the project have to be borrowed up front before it is begun. E) negative, because the cost of the project is immediate, but revenue streams from the project come later.