If the Minimum Efficient Scale in an Industry Were Smaller

question 396

True/False

If the minimum efficient scale in an industry were smaller than the size of the market of that industry, then we would have a natural-monopoly situation.

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Definitions:

Productivity

In industry, the capability to produce effectively, gauged by how much output is generated per input unit.

Reinforcement

In psychology, a process by which a behavior is strengthened or increased in frequency, often through the application of a reward or the removal of a negative stimulus.

Enforced Commitment

The obligation or dedication imposed by external factors or authorities.

Social Loafing

Individuals often put in less effort when part of a group compared to when they work by themselves.