Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter9: Market Structure And Long-run Equilibrium
Section: Chapter Questions
Problem 4MC
Related questions
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I need help with A and B
![Market Structure and Market Power – End of Chapter Problem
-
a. When, if ever, would a monopoly in a particular industry be preferred to competition within that industry?
It is never ideal to let a monopoly exist.
When only a few firms exist in an industry, so that the government must intervene to promote competition.
When it would be less costly for one firm rather than many firms to provide a good, as in a natural monopoly.
When too many firms are in an industry, and the market is too chaotic to receive clear price signals.
b. Which of the following are examples of a natural monopoly? Select all that apply.
A local church or religious organization
Whole Foods
A local utility company
Swift Trucking](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F88a2fc98-e0a4-40b8-93ba-f16dd72c0f3b%2Fcea8be32-0ce5-4fef-86db-d74ee5a60a68%2Fufv66xf_processed.png&w=3840&q=75)
Transcribed Image Text:Market Structure and Market Power – End of Chapter Problem
-
a. When, if ever, would a monopoly in a particular industry be preferred to competition within that industry?
It is never ideal to let a monopoly exist.
When only a few firms exist in an industry, so that the government must intervene to promote competition.
When it would be less costly for one firm rather than many firms to provide a good, as in a natural monopoly.
When too many firms are in an industry, and the market is too chaotic to receive clear price signals.
b. Which of the following are examples of a natural monopoly? Select all that apply.
A local church or religious organization
Whole Foods
A local utility company
Swift Trucking
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