select the correct answer. when does a natural monopoly arise? a. when a single seller buys or takes over…

select the correct answer. when does a natural monopoly arise? a. when a single seller buys or takes over all the competitors in the market b. when multiple sellers have access to scarce natural resources in a region c. when economies of scale occur over a relevant range of output d. when a limited number of sellers decide to jointly sell their products

select the correct answer. when does a natural monopoly arise? a. when a single seller buys or takes over all the competitors in the market b. when multiple sellers have access to scarce natural resources in a region c. when economies of scale occur over a relevant range of output d. when a limited number of sellers decide to jointly sell their products

Answer

Brief Explanations:

A natural monopoly occurs when long - run average total costs are decreasing over the relevant range of output due to economies of scale. This makes it more efficient for one firm to produce the entire industry output. Option A describes a merger or acquisition to create a monopoly, not a natural one. Option B doesn't lead to a natural monopoly. Option D is more related to oligopoly behavior like a cartel.

Answer:

C. when economies of scale occur over a relevant range of output