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- Subject
- Monopolyeconomics-mcqs › monopoly
- Published
- 30 May 2019
- Last updated
- 28 May 2026
What is the likely impact on production costs if a natural monopoly is divided into several smaller companies by regulators?
Multiple choice question for Monopoly. Select an option, then review the explanation below.
Explanation
When a natural monopoly is split into multiple smaller firms, the loss of economies of scale typically causes production costs to rise.
More Monopoly MCQs
Practice related questions from the same subject.
- 1.Which option best describes the concept of price discrimination?
- 2.In contrast to a perfectly competitive market, what is a monopolist more inclined to do?
- 3.In a pure monopoly market, how does the price compare to the marginal revenue?
- 4.What action should a monopolist take when marginal revenue is greater than marginal cost?
- 5.What is a common outcome of public ownership in natural monopolies?