Question

The PRIMARY reason that natural monopolies are allowed to exist in areas such as energy production is that A) it would be too difficult to regulate these industries. B) it is more efficient for society to allow one company to be in control. C) it is not in the public interest to deregulate the providing of utilities. D) it would create inflationary pressures to allow more than one company to compete.

Answer 1

Answer: B) it is more efficient for society to allow one company to be in control.

Explanation: A natural monopoly is a type of monopoly that exists due to the high fixed and start-up costs. Most natural monopolies are found in job areas where raw materials or technology are needed to maintain operation. it is more effective and efficient for society to allow one main company to control their area so that is why more societies allow one company to have the control.