Why are water companies considered a natural monopoly? What ...

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Why are water companies considered a natural monopoly?
 
  What will be an ideal response?

Question 2

The percentage change in the quantity demanded of a good due to a percentage change in its price is referred to as the:
 
  A) price multiplier.
  B) price elasticity of demand.
  C) shadow price of the good.
  D) consumer surplus.

[jointhecircus]

Answer to Question 1

Once one water company incurs the cost of establishing a physical connection to one customers' home or place of business, the marginal cost of providing service falls rapidly over time as more and more service is provided. For instance, once a main pipe is buried under a street, adding additional customers on the street is relatively chea

Answer to Question 2

B

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Excellent

[peter]

Gracias!