ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Types of Natural Monopolies For example, the utility industry is a natural monopoly. The utility monopolies provide water, sewer services, electricity transmission, and energy distribution such as retail natural gas transmission to cities and towns across the country.

Detailed explanation-2: -(1)Marginal Cost Pricing: Hence, the government can regulate the monopolies by setting the price equal to Price = Marginal cost. This will set the market conditions closer to a perfectly competitive market ensuring higher quality and lower price compared to what the monopoly would have charged.

Detailed explanation-3: -Two examples of government-sanctioned monopolies in the United States are the American Telephone and Telegraph Corporation (AT&T) and the United States Postal Service. Prior to its mandated break up into six subsidiary corporations in 1982, AT&T was the sole supplier of U.S. telecommunications.

Detailed explanation-4: -Check all that apply. pipelines railway lines supermarkets electric companies sporting goods stores fixed-line telephone companies.