In the figure, MPF reaches its highest concentration during this stage.
Definitions:
Natural Monopoly
An industry that realizes such large economies of scale that single-firm production of that good or service is most efficient.
Profit-Maximizing Price
The price at which a firm can sell its product to earn the maximum possible profit on those sales.
Marginal Revenue
The additional income from selling one more unit of a good; it is the change in total revenue from an additional unit sold.
Marginal Revenue
The increase in revenue resulting from the sale of one additional unit of a product.
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