If Economies of Scale in an Industry Are So Extensive

question 187

Multiple Choice

If economies of scale in an industry are so extensive that a single firm could serve the entire market at a lower cost than if the market was split between two or more firms, this industry is called a(n)

• A) conglomerate
• B) natural monopoly.
• C) oligopoly.
• D) restraint of trade.

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Definitions:

Anchor

A device, usually made of metal, used to connect an object to a base or a fixed point to prevent or restrict movement.

Rotate

To turn or spin around an axis or center point.

Self-adjuster

A component in drum brakes that automatically maintains the correct distance between the brake shoes and drum.

Threaded Self-adjuster

A component in drum brakes that automatically adjusts the brake shoes’ positioning to maintain optimal distance from the drum.