Which of the following is true under natural monopoly?

A) The marginal cost curve will be above the average cost curve.
B) The monopolist will set price equal to marginal cost and will earn economic profits.
C) Economies of scale will be present.
D) Output is produced under conditions of constant cost.

Natural Monopoly

A market condition where a single supplier is most efficient in producing a good or service due to high initial costs and substantial economies of scale.

Marginal Cost

The augmentation in cumulative costs linked with generating an extra unit of a product or service.

Average Cost

The overall expense of manufacturing split by the quantity of units made.