16.2k views
9 votes
What term refers to a situation in which it's more efficient and actually more

desirable to have just one company rather than several competing companies?

2 Answers

10 votes

Answer:

natural monopoly

Step-by-step explanation:

User Jandi
by
4.0k points
5 votes

Answer:

Natural monopoly is the term that refers to a situation where it's more efficient and actually more desirable to have just one company rather than several competing companies.

Step-by-step explanation:

An example of a natural monopoly is the tap water. Logically, just having a single company providing a network of pipes and sewage systems works well, this is because there are very high capital costs when it comes to setting up a national network of water pipes and sewers. if you have two different companies offering water the mean cost would be very high compared to just one firm and one network.

User Arseniy Rubtsov
by
3.4k points