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A small number of large firms control the entire

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Unformatted text preview: source of economies of scale? A. Fixed costs. B. Bottlenecks in production processes. C. Learning-by-doing. D. Physical characteristics of production processes. 44 25. “Natural monopoly” refers to a situation where A. a small number of large firms control the entire market. B. a single firm can produce for the entire market at lower unit cost than would be possible for two or more firms splitting the market. C. a monopoly is created by a technology patent . D. a single public utility controls the market. 26. “Electricity transmission in BC is an example of natural monopoly”. True or false? A. True. B. False. 27. “Economies of scope” means that A. production costs rise as the level of production rises. B. production costs fall as the level of production falls. C. unit production costs rise as the level of production rises. D. the unit production cost of one product is lower if it is produced in conjunction with another product. 28. Economies of scope can be a barrier to entry because A. they m...
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