Multiple Choice
If the distribution of water is a natural monopoly, then
A) a single firm cannot serve the market at the lowest possible average total cost.
B) allowing for competition among different firms in the water-distribution industry is efficient.
C) multiple firms would likely each have to pay large fixed costs to develop their own network of pipes.
D) average cost increases as the quantity of water produced increases.
Correct Answer:
Verified
Correct Answer:
Verified
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