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Unformatted text preview: Ex. Perrier owns its springs, no one else can use them 2. Patents and Copyrights Ex. Microsoft owns copyright for Windows 3. Government licenses or franchises Ex. License for restaurant on thruway rest area 4. Economies of Scale Ex. Very high fixed costs; need lots of money down to be competitive IRTS Increasing returns to scale CRTS Constant returns to scale D D D D DRTS Decreasing returns to scale More customers, lower cost/price Natural Monopoly for entire range of output you have IRTS 5. Network Economies larger number of users, greater benefit for each user Ex. Phones one person, low benefit; many people, larger benefit to each person Ex. Most important to Windows/Microsoft because of number of people who use it Profit Maximizing for the Monopolist...
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