Which of the following statements are true about this natural monopoly? Check all that apply. The cable company is experiencing economies of scale. In order for a monopoly to exist in this case, the government must have intervened and created it. It is more efficient on the cost side for one producer to exist in this market rather than a large number of producers. O The cable company is experiencing diseconomies of scale. True or False: Without government regulation, natural monopolies can earn positive profit in the long run. O True O False

Survey Of Economics
10th Edition
ISBN:9781337111522
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter8: Monopoly
Section: Chapter Questions
Problem 15SQ
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Which of the following statements are true about this natural monopoly? Check all that apply.
O The cable company is experiencing economies of scale.
O In order for a monopoly to exist in this case, the government must have intervened and created it.
It is more efficient on the cost side for one producer to exist in this market rather than a large number of producers.
O The cable company is experiencing diseconomies of scale.
True or False: Without government regulation, natural monopolies can earn positive profit in the long run.
s can
True
False
Transcribed Image Text:Which of the following statements are true about this natural monopoly? Check all that apply. O The cable company is experiencing economies of scale. O In order for a monopoly to exist in this case, the government must have intervened and created it. It is more efficient on the cost side for one producer to exist in this market rather than a large number of producers. O The cable company is experiencing diseconomies of scale. True or False: Without government regulation, natural monopolies can earn positive profit in the long run. s can True False
The following graph shows the demand (D) for cable services in the imaginary town of Utilityburg. The graph also shows the marginal revenue (MR)
curve, the marginal cost (MC) curve, and the average total cost (ATC) curve for the local cable company, a natural monopolist.
On the following graph, use the black point Colus symbol) to indicate the profit-maximieing price and quantity for this natural monopolist.
100
Monopoly Outcome
70
00
30
10
MR
(uo ans ad syoal Bod
Transcribed Image Text:The following graph shows the demand (D) for cable services in the imaginary town of Utilityburg. The graph also shows the marginal revenue (MR) curve, the marginal cost (MC) curve, and the average total cost (ATC) curve for the local cable company, a natural monopolist. On the following graph, use the black point Colus symbol) to indicate the profit-maximieing price and quantity for this natural monopolist. 100 Monopoly Outcome 70 00 30 10 MR (uo ans ad syoal Bod
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