HELP WITH MICRO...Large minimum efficient scale of plant combined with limited market demand may lead to?
Large minimum efficient scale of plant combined with limited market demand may lead to?
A. Natural Monopoly
B. Patent Monopoly
C. Government franchise monopoly
D. Shared Monopoly
I would go for C. Because it will cause inefficiency, and limited demand due to corruption (too many franchise)
A is not true because it is mainly due to high investment.
B is not true, the demand will not be limited.
D is not true. monopoly + collusion will held higher price and market share.
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