The existence of economies of scale can create _______.
A) a government monopoly
B) a natural monopoly
C) a legal monopoly
D) a market in which many firms make identical products

Question

Quizplus · Accepted Answer

Economies of scale can lead to a natural monopoly because as a firm grows larger and produces more, the average cost of production decreases, potentially allowing a single firm to supply the entire market more efficiently than multiple smaller firms.

The Existence of Economies of Scale Can Create _______