When Does a Natural Monopoly Arise

question 228

Multiple Choice

When does a natural monopoly arise

• A)when there are constant returns to scale over the relevant range of output
• B)when there are economies of scale over the relevant range of output
• C)when one firm owns a key natural resource
• D)when the government gives a single firm the exclusive right to produce a particular good or service

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Definitions:

Neural Messages

Electrical and chemical signals that are transmitted by neurons to send information throughout the nervous system.

Optic Nerve

A cranial nerve that transmits visual information from the retina to the brain.

Light Rays

Streams of photons that move in a straight line and are responsible for allowing the human eye to see and perceive the world around.

Encoding

The initial process of transforming information into a form that can be stored in memory.