Which of the following is a characteristic of a natural monopoly?

They use natural resources as their main input. Average total cost rises over a large range of output.

They are monopoly because of patents.

Average total cost declines over a large range of output.

Barriers to entry that can discourage or prevent potential competitors from entering a market are

economies of scale

control of a physical resource

patents

Because no good substitutes exist for a monopolist's product, the demand curve that it faces is

unit-elastic.

perfectly inelastic.

downward sloping.

perfectly elastic.

One problem with government operation of monopolies is that

under government operation monopoly can be more profitable.

the government typically has little incentive to reduce costs.

monopolies typically have rising average costs.

government is likely to be more interested in political gain.