Asked by Sherry Smith on Jun 22, 2024
Verified
The best option to control the behavior of a natural monopoly is to use public ownership of the monopoly.
Natural Monopoly
A market condition where a single firm can provide a good or service at a lower cost than any competitors, due to economies of scale.
Public Ownership
Public ownership denotes ownership by the government or a public entity, often applied to assets, utilities, or enterprises meant for public benefit.
- Consider the significance of government-held assets and oversight in reining in monopoly power and safeguarding the well-being of the community.
Verified Answer
JB
JAMES BAILEYJun 26, 2024
Final Answer :
False
Explanation :
Public ownership is one option to control a natural monopoly, but not necessarily the best in all cases. Regulation of privately owned monopolies can also effectively control behavior, ensuring fair prices and quality service without the drawbacks of public ownership, such as potential inefficiency and lack of innovation.
Learning Objectives
- Consider the significance of government-held assets and oversight in reining in monopoly power and safeguarding the well-being of the community.