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Where minimum efficient scale is very huge for capital intensive operations, it may be more cost effective to allow one company to spread its fixed costs over a very huge number of consumers, rather than have various competing firms suffer the fixed costs of a minimum efficient scale and have to share a customer base. There are various industries that are very capital intensive and need large initial investments to operate. These types of firms are frequently natural monopolies. Railroads, electric generating companies, and air lines needs tens of millions of dollars in fixed costs.
Policy Implications: The expansion of the services sector has wider implications for population, employment, and trade prospects of the economy, some of which are as follows:
Raise or Lower Tuition? Suppose that, in an attempt to raise more revenue, Nobody State University increases its tuition. Assess a raise in tuition and if it will necessarily res
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In theory, we know that a monopolist basis its price directly off of the demand curve, but in practice a monopolist cannot ''see'' the demand curve. Explain how a monopolist might
The Industry's Long-Run Supply Curve * Long-Run Elasticity of Supply 1) Constant-cost industry Long run supply is horizontal Small increase in price will induc
a. Determine Australia’s market equilibrium for TV sets. i. (1) What are the equilibrium price and quantity?
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Implications of Williams model of managerial discretion in Nepalese industries
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Private Returns Versus Social Returns As there is subsidisation of education by the state in all countries (and a little higher subsidisation in developing countries) it happe
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