In Many Cases Additional Firms Do Not Try to Compete

question 90

Multiple Choice

In many cases additional firms do not try to compete with a natural monopoly because:

• A)the natural monopoly doesn't make a huge profit
• B)they are unsure of the size of the market in general
• C)they know they cannot achieve the same low costs that the monopolist enjoys
• D)they fear retaliation in the form of pricing wars from the natural monopolist

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