Purchase Solution

Traditional examples of natural monopolies

Not what you're looking for?

Ask Custom Question

How does globalization lead to greater competition in the market place? What are the implications for market structure in industries opened to global competition?

What is an example of a natural monopoly? Will a monopoly always produce at a profit-maximizing level of output? Explain.

Purchase this Solution
Solution Summary

The answer explains how globalization can affect market structure as well as the operation of natural monopolies and their ability to maximize profits.

Solution Preview

Globalization can lead to more competition in the market because it allows for foreign companies to enter the market and compete with local companies. For example, Chinese shrimp imported into Canada will compete with Canadian producers and create price competition, which would increase the amount of shrimp in the market, lower the price and improve the lot of consumers who eat shrimp. It is important to note, however, that businesses and workers in Canada might suffer from such opening of the borders. Chinese labor costs are lower, which gives them that advantage, but it is note worthy that they face higher transportation costs than Canadians businesses whose products must travel shorter distances to retailers. In terms of market structure, it would depend on the nature of the industry. Staple industries, like shrimp, steel, cement, wheat, etc, would simply be ...

Purchase this Solution
Free BrainMass Quizzes
Economics, Basic Concepts, Demand-Supply-Equilibrium

The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.

Economic Issues and Concepts

This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.

Elementary Microeconomics

This quiz reviews the basic concept of supply and demand analysis.

Pricing Strategies

Discussion about various pricing techniques of profit-seeking firms.

Basics of Economics

Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.

View More Free Quizzes
Related BrainMass Solutions

  • government-granted monopolies

    70268 government-granted monopolies How can you justify the existence of government-granted monopolies for such public utilities as local telephone service, natural gas distribution, and electricity in the light of the traditional economic argument that

  • Natural monopoly examples

    Economists usually favor private ownership to public ownership of natural monopolies, why is it?

  • Monopoly and its Effect on Society

    Note the excerpt below which provides information on the various types of monopolies; that is, natural monopolies geographic monopolies, technological monopolies and government monopolies: "A natural monopoly occurs when the type of industry makes

  • Monopolies

    127738 Monopolies Effects on Capitalistic Economy What effects do monopolies have on a capitalistic economy? What are some advantages and disadvantages of monopolies? Give some examples of monopoly type companies?

  • Common goods, public goods, private goods, natural monopolie

    The Control of Natural Monopolies, Lexington Books. 780 words, APA

  • private goods, public goods, natural monopolies, and open-access goods

    349140 Private Goods, Public Goods, Natural Monopolies, & Open-Access Explain the differences between private goods, public goods, natural monopolies, and open-access goods. Provide examples of each with your explanations. Public vs.

  • Difference between monopolistic and perfect competition

    Other examples are the water company and other utilities and some pharmaceuticals for which there are no substitions and which are necessary. Most natural monopolies are regulated.

  • Minimum Efficiency Scale

    Natural monopolies can be particularly beneficial. This is because of their ability to attain lower costs of production, often far lower, than would be possible with competitive firms producing the same product in the same region.

  • natural monopoly

    187973 Natural monopoly A function of government is to regulate "natural monopolies." Explain what is a natural monopoly and why it requires government regulation.

View More Related Solutions