Asked by
Olona Khuzwayo
on Oct 27, 2024
Verified
Lenoia runs a natural monopoly producing electricity for a small mountain village.The barrier preventing other firms from competing with her is:
A) her control of scarce natural resources.
B) the existence of economies of scale.
C) her technological superiority.
D) a government-set barrier.
Economies of Scale
The cost advantage experienced by a firm when it increases its level of output. The average costs per unit of output decrease with the scaling up of production.
- Acquire insight into the idea of natural monopolies and acknowledge specific cases in the economy.
- Elucidate the function of government and regulatory measures in the context of monopolies and the entry into markets.
Verified Answer
NH
Learning Objectives
- Acquire insight into the idea of natural monopolies and acknowledge specific cases in the economy.
- Elucidate the function of government and regulatory measures in the context of monopolies and the entry into markets.