What Is Most Likely to Happen as the Output of a Natural

question 231

Multiple Choice

What is most likely to happen as the output of a natural monopoly increases over the range of market demand?

• A) There is a small decrease in average total cost and then it increases as output increases.
• B) There is an increase in average total cost and then it decreases as output increases.
• C) Average total cost increases as output increases.
• D) Average total cost decreases as output increases.