Question

The government often allows only one company to provide electricity in a given geographic area because allowing several companies to do so would result in an inefficient duplication of infrastructure. This suggests that electric utilities are:

Answer 1

natural monopolies

Step-by-step explanation:

Natural monopolies -

It refers to the method of monopoly of the industry , where the cost of the infrastructure and other appliances is very high i.e. , the cost of start up is very high in order to initiate the business , is referred to a natural monopolies .

Therefore , it is preferred to have a single natural over a particular geographical location , because unnecessary many natural monopoly would lead to the wastage of the resources and can even lead to inefficient duplication of the infrastructure .

Hence , from the given scenario of the question ,

The correct answer is natural monopolies .