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The graph shows the revenues and costs for a natural monopoly. A graph plots a demand curve, ATC curve, and an MR curve with Quantity
The graph shows the revenues and costs for a natural monopoly. A graph plots a demand curve, ATC curve, and an MR curve with Quantity along the horizontal axis and Price, costs, marginal revenue along the vertical axis. The demand curve and the MR curve start at a common point on Price, labeled as C, and have negative slopes. Point B is marked on the demand curve at G on quantity, A on Price. A horizontal line, labeled MC, starts at M on price and runs parallel to quantity. The line intersects the MR curve at G on quantity, and the point is labeled as H. The line intersects the demand curve at F on quantity, and the point is labeled as E. The ATC curve has a negative slope that levels off going to the right. It intersects the demand curve at H on quantity, J on price and the point is labeled as D. Point K is marked on the ATC curve at G on quantity, L on price. Point I is marked on the MC line at H on quantity. The fact that it is a natural monopoly is revealed by the: horizontal marginal cost curve. downward-sloping marginal revenue curve. downward-sloping average total cost curve. downward-sloping demand curve
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