A Natural Monopoly Is Defined as an Industry in Which

question 128

Multiple Choice

A natural monopoly is defined as an industry in which one firm

• A) can produce the entire industry output at a lower average cost than a larger number of firms could.
• B) can produce the entire industry output at a lower marginal cost than a larger number of firms could.
• C) is very large relative to other firms that could enter the industry.
• D) can earn higher profits if it is the only firm in the industry rather than if other firms also enter the industry.

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Definitions:

Intended Beneficiary

A person for whom a contract is specifically made and who has the right to enforce the contract terms against the parties involved.

Donee Beneficiary

A third party who benefits from a contract between two other parties, especially in the context of gifts or estates.

Gratuitous Assignment

An assignment or transfer of rights or property done voluntarily without receiving any value in return.

Irrevocable

Incapable of being taken back, undone, or cancelled, often used in the context of certain contracts, trusts, or offers.