why does the government usually regulate natural monopolies? a. to ensure that marginal revenue is the same as price b. to make sure that companies profit from their research c. to keep the monopolist from having too much power

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01-12-2022
Business

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why does the government usually regulate natural monopolies? a. to ensure that marginal revenue is the same as price b. to make sure that companies profit from their research c. to keep the monopolist from having too much power

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smecloudbird18 smecloudbird18 · Answer 1 · 2022-12-05T22:21:04-05:00

To ensure that marginal revenue is the same as price the government usually regulate natural monopolies. (the right option is A). If one company can serve a market more affordably than any combination of two or more enterprises, that market has a natural monopoly.

As an illustration, the utilities sector is a natural monopoly. To cities and towns across the nation, utility monopolies offer water, sewage, electricity transmission, and energy distribution services including retail natural gas transmission. A government market with a natural monopoly is one whose size allows a single vendor to supply the output. A natural monopolist can generate all of the market's product for less money than it would cost if there were several competing company.

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