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What is a natural monopoly? Provide a real-life example.

Question:

What is a natural monopoly? Provide a real-life example.

Monopoly:

A monopoly is a single business that supplies a product that lacks close substitutes. Due to lack of competition, a monopoly company has market power, that is, the capacity of one firm to unjustifiably sway the market prices.

Answer and Explanation:

A natural monopoly refers to an industry in which a single company can deliver a good or service to the whole market at a lesser cost than if two or...

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Natural Monopoly in Economics: Definition & Examples

from Intro to Business: Help and Review

Chapter 3 / Lesson 13
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