Explore BrainMass

Natural monopoly and the cost and demand curve

This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

Explain what natural monopoly is in terms of the relationship between cost curves and the demand curve. If the market is left to itself, what price and output will result?

© BrainMass Inc. brainmass.com March 21, 2019, 7:21 pm ad1c9bdddf


Solution Preview

The whole idea of natural monopolies is that fixed costs (including initial investments) are so high that to have a number of companies undertake them would mean that they would all have really high costs that would then be passed on to consumers. For example, it is ...