The key issue in determining the efficiency of public versus private ownership of a monopoly is:
A)the inability of private monopolies to get rid of managers who are doing a bad job
B)how ownership of the firm affects the cost of production
C)the tendency for efficient management of publicly owned enterprises
D)the propensity of private monopolies to generate excessive profits

Question

Quizplus · Accepted Answer

The key issue is how ownership affects the cost of production. A private monopoly may have a stronger incentive to reduce costs and improve efficiency in order to maximize profits, while a public monopoly may face less pressure to do so. However, it is also possible that a publicly owned monopoly may operate more efficiently due to the accountability and transparency requirements that come with public ownership. The other options are not as relevant to this issue.

The Key Issue in Determining the Efficiency of Public Versus