Figure 13.9 Figure 13.9 Shows the Cost and Demand Curves for the and Demand

question 55

Multiple Choice

Figure 13.9

Figure 13.9 shows the cost and demand curves for the Erickson Power Company.
-Refer to Figure 13.9.Erickson Power is a natural monopoly because

• A)it is a power company and all power companies are natural monopolies.
• B)average total cost is still declining when it intersects demand.
• C)of its continually declining marginal revenue curve as output rises.
• D)its marginal cost lies entirely below its long-run average cost.

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