In a Natural Monopoly, Throughout the Range of Market Demand

question 85

Multiple Choice

In a natural monopoly, throughout the range of market demand,

• A)the marginal cost is above average total cost and pulls average total cost upward.
• B)average total cost is above the marginal cost and pulls the marginal cost upward.
• C)the marginal cost is below average total cost and pulls average total cost downward.
• D)there are diseconomies of scale.

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Definitions:

Public Policy

Principles and standards considered to be in the interest of the public and used as a guide in legislative, judicial, or administrative actions.

Reasonable

Actions, decisions, or policies that are logical, fair, and sensible from an objective viewpoint.

Illegal Contract

A contract that is unenforceable by law because it involves activities that are against the law or public policy.

Restraint Trade

Legal provisions designed to prohibit or control practices that restrict free trading and competition between businesses.