To Be a Natural Monopoly a Firm Must

question 63

Multiple Choice

To be a natural monopoly a firm must

• A) control a key resource input.
• B) have economies of scale that are so large that it can supply the entire market at a lower cost than two or more firms.
• C) have significant network externalities.
• D) be very large relative to the total market.

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Definitions:

Milgram Experiment

A psychological experiment conducted by Stanley Milgram in the 1960s to study obedience to authority, where participants were instructed to administer electric shocks to another person.

Stanford University Prison Experiment

A psychological study conducted by Philip Zimbardo in 1971 at Stanford University, where students were assigned roles of prisoners and guards to explore the effects of perceived power.

Generalization

Drawing a conclusion about a certain characteristic of a population based on a sample from it.

Logical Support

The provision of reasons or evidence to justify a claim or argument.