GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which of the following is most likely an example of a monopoly?
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A Starbucks across from Dunkin Donuts
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A gas station in a town by itself
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3 fast food restaurants all on the same street
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A Sainsbury’s 4 miles away from a Tesco’s
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Explanation:
Detailed explanation-1: -Answer and Explanation: d. a local electricity company is the most likely example of a monopoly. The generation of electricity requires huge investments of capital.
Detailed explanation-2: -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-3: -The U.S. markets that operate as monopolies or near-monopolies in the U.S. include providers of water, natural gas, telecommunications, and electricity.
There is 1 question to complete.