The International Nickel Company of Canada Is Often Cited as an Example

question 113

Multiple Choice

The International Nickel Company of Canada is often cited as an example of monopoly. What was the source of the barrier to entry that gave this firm monopoly power?

• A) It was a public enterprise; therefore, the Canadian government blocked entry into the market for nickel.
• B) There were important network externalities in the production of nickel.
• C) Economies of scale resulted in the company becoming a natural monopoly.
• D) control of a key resource

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Definitions:

Financial Risk

The equity risk that comes from the financial policy (i.e., capital structure) of the firm.

Prices

The amount of money required to purchase goods or services.

Rate Of Change

The speed at which a variable quantity, such as a number or measurement, changes over a certain period of time.

Sheet Steel

A type of steel that has been rolled into sheets; commonly used in manufacturing and construction industries.