ECONOMICS (CBSE/UGC NET)

Previous
Next

ECONOMICS

COMPETITION AND MARKET STRUCTURES

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
In the 1990s, AT&T controlled 80% of the phone industry and was the ONLY provider of long distance phone service. This is an example of
A
A monopoly
B
Monopolistic Competition
C
Perfect Competition
D
Oligopoly
Explanation: 

Detailed explanation-1: -Natural gas, electricity companies, and other utility companies are examples of natural monopolies. They exist as monopolies because the cost to enter the industry is high and new entrants are unable to provide the same services at lower prices and in quantities comparable to the existing firm.

Detailed explanation-2: -The U.S. markets that operate as monopolies or near-monopolies in the U.S. include providers of water, natural gas, telecommunications, and electricity.

Detailed explanation-3: -Public utilities: gas, electric, water, cable TV, and local telephone service companies, are often pure monopolies.

Detailed explanation-4: -Natural Monopoly. Only one company providing a public good or service. Technological Monopoly. When a single firm has exclusive rights over the technology used to manufacture it. Geographic Monopoly. Government Monopoly. Least Threat: Four Types of Monopolies.

There is 1 question to complete.
Previous
Next