ECONOMICS
COMPETITION AND MARKET STRUCTURES
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
perfect competition
|
|
|
monopoly
|
|
|
monopolistic competition
|
|
|
oligopoly
|
Detailed explanation-1: -A natural monopoly is a type of monopoly that arises due to unique circumstances where high start-up costs and significant economies of scale lead to only one firm being able to efficiently provide the service in a certain territory.
Detailed explanation-2: -There are very stringent requirements for pure monopoly: (1) There is only one firm in the industry. (2) There are no close substitutes for the good the firm produces. (3) There is some reason why the entry and survival of a competing firm is unlikely.
Detailed explanation-3: -A monopoly is a market structure that consists of only one seller or producer.
Detailed explanation-4: -The antitrust laws prohibit conduct by a single firm that unreasonably restrains competition by creating or maintaining monopoly power.