If the Distribution of Water Is a Natural Monopoly, Which

question 78

Multiple Choice

If the distribution of water is a natural monopoly, which of the following is true?
(i) allowing for competition among different firms in the water distribution industry is efficient
(ii) a single firm can serve the market at a lower average total cost
(iii) multiple firms will each have to pay large fixed costs to develop their own network of pipes

• A)(i) and (ii)
• B)(ii) and (iii)
• C)(i) and (iii)
• D)(i) only

---

Definitions:

Telecommunications Act

A significant law passed by Congress in 1996 to deregulate and reform the telecommunications industry, aiming to increase competition.

Media Outlets

Organizations that disseminate news, information, entertainment, and other contents through various distribution channels.

National Audience Reach

The extent to which content, such as a broadcast or publication, is accessible or viewed by people across a nation.

Watchdog Function

The role of the media or other entities in monitoring governmental activities and alerting the public to wrongdoing or inefficiency.