What Is the Defining Characteristic of a Natural Monopoly? Give

question 2

Essay

What is the defining characteristic of a natural monopoly? Give an example of a natural monopoly.

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Definitions:

Bond Sales

The process of issuing debt securities by entities such as corporations or governments to investors to raise capital.

Crowding-Out Effect

A situation where increased government spending leads to a reduction in private sector spending, which could negate the stimulus effect of the government's spending.

Government Borrowing

The act of governments raising funds through issuing debt securities or borrowing directly from financial institutions to finance government spending.

Private Sector

The private sector encompasses businesses and activities not owned or directly managed by the government, operating primarily through the private enterprise and market system.