If There Are Economies of Scale Throughout the Relevant Output

question 113

Multiple Choice

If there are economies of scale throughout the relevant output range of production,which is false?

• A) It is a natural monopoly.
• B) It is more efficient to have a single firm produce the good.
• C) It would typically result from a firm's possession of an exclusive patent.
• D) One large firm can produce at lower cost than two or more smaller firms.

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Definitions:

Pure Monopolist

A single seller in a market that has no close substitutes, giving the seller complete control over the price and quantity of goods or services.

Profit-Maximizing

The act of adjusting production levels, prices, or other business operations to achieve the maximum profit.

Local Monopoly

A market structure wherein a single firm dominates the market in a particular geographic area, often due to the absence of viable competitors.

Demand Graphs

Visual representations used to show the relationship between the price of a good and the quantity demanded over a certain period.