Which of the following firms are more likely to exhibit economies of scale and be a...
Which of the following firms are more likely to exhibit economies of scale and be a natural monopolist
a) One with large fixed costs and large marginal costs.
b) One with large fixed costs and small marginal costs.
c) One with small fixed costs and small marginal costs.
d) One with small fixed costs and large marginal costs.
Homework Answers
The correct option is b. One with large fixed costs and small marginal costs.
Explanation-
Economies of scale exists when average costs falls as the scale of production grows.
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Which of the following firms are more likely to exhibit
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