A Firm That Has Taken Advantage of Economies of Scale

question 220

Multiple Choice

A firm that has taken advantage of economies of scale and expanded to become the only producer in the market is

• A) a cartel.
• B) a natural monopoly.
• C) a monopolistic competitor.
• D) an oligopolist.

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Definitions:

Chequing Account

A bank account that allows the holder to make deposits, withdrawals, and payments via cheques and is typically used for everyday transactions.

Paycheque

A check issued to an employee for earned wages, representing the net amount after deductions such as taxes and social security contributions.

Compensating Balances

A minimum bank account balance a borrower is required to maintain as part of a loan agreement, offering the bank some security.

Transactional Motive

The transactional motive is the need to hold cash for the purpose of conducting day-to-day business operations, such as paying wages and suppliers.