have more power to govern and rule themselves. It’s a similar situation with a monopoly. The pros would be that monopolies have full control over prices, they also benefit from economies of scale, resulting in lower average costs, they also make a higher profit. The cons however include potentially higher prices for consumers, lack of choice for consumers since there is no competition to choose as substitutes, and when left unregulated, they can inefficiently allocate resources.2.Why are companies such as Coke or Pepsi willing to give a university millions of dollars, if they can be the sole vendor on campus? Both companies
know that they’ll make a huge profit. Since buying a soda from a vending machine on school or college campuses is often more affordable, and more convenient, then buying off campus…students and faculty are more likely to buy soda from these vending devices.3.Why does the government allow a single utility company, such as Rocky Mountain Power, to be the sole provider of electricity to a city? Since this would count as a natural monopoly, the government can make regulations that allows for fair prices for local consumers, as well as receive tax to fund other public utilities.4.Go to (Copy and paste thelink in your browser, if needed)a.Find Table 2b.Browse Table 2 and select three different industries. Once you
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