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A natural monopoly is different from a market monopoly. A natural monopoly is often both protected and regulated by the government because it is deemed
A natural monopoly is different from a market monopoly. A natural monopoly is often both protected and regulated by the government because it is deemed a benefit to society. Describe an example of a real-world industry or market that would be considered by economists to be anatural monopoly. Be sure to address the following questions in your answer.
- What characteristics of the natural monopoly industry you identified make it similar to a market monopoly?
- What is the impact of monopoly power on you as a customer?
- Why does the government choose to regulate some natural monopolies rather than ban them? Is this ethical?
- How might such regulation be structured to benefit both the producers and the consumers?
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