1)The simplest way for a monopoly to arise is for a single firm to: a

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1)The simplest way for a monopoly to arise is for a single firm to:

a. Decrease its prices without consulting other firms,

b. Decrease production to increase demand for its product,

c. Jointly make pricing decisions with other firms,

d. Own a key resource.

2)A natural monopoly occurs when:

a. The product is sold in its natural state (such as water or diamonds),

b. There are economies of scale over the relevant range of output,

c. The firm is characterized by a rising marginal cost curve,

d. Production requires the use of free natural resources, such as water or air.