If economies of scale in an industry are so extensive that a single firm can supply the entire market at lower unit cost than could a number of competing firms,this industry is called a(n)
A) conglomerate.
B) natural monopoly.
C) oligopoly.
D) restraint of trade.
E) monopolistic competition.

Question

Quizplus · Accepted Answer

A natural monopoly occurs when economies of scale are so extensive that a single firm can supply the entire market at a lower unit cost than could a number of competing firms.

If Economies of Scale in an Industry Are So Extensive