Question

Large minimum efficient scale of plant combined with limited market demand may lead to?

Answer 1

A large minimum efficient scale of the plant combined with limited market demand may lead to a natural monopoly. Pure monopolists may obtain economic profits in the long run because: of barriers to entry.

A natural monopoly is a type of monopoly that typically exists because of high initial costs or strong economies of scale of running a business in a particular industry and can pose significant barriers to entry for potential competitors. there is.

A natural monopoly is a monopoly in an industry that has high infrastructure costs or other barriers to entry relative to the size of the market, giving the industry's largest players, often the first players in the market, an overwhelming advantage. give sex. potential competitors

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