The Diagram Below Shows Cost and Revenue Curves for a Natural

question 100

Multiple Choice

The diagram below shows cost and revenue curves for a natural monopoly producing electricity.Price is dollars per kilowatt hour and quantity is kilowatt hours per day.
FIGURE 12- 7
-Traditionally,economists have regarded monopoly as an undesirable market structure because

• A)it is usually characterized by wastefully confrontational labour relations.
• B)it allows producers to earn large profits.
• C)of its ability to minimize costs through large output.
• D)it is allocatively inefficient.
• E)of its wasteful innovation.

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