Question

Suppose a firm is allowed to operate as a monopoly due to the presence of large economies of scale. Social welfare can potentially gain if Multiple choice question. price is regulated at the socially efficient level. profits are regulated at the socially efficient level. the HHI exceeds 1,800. profits are forced to be negative

Answer 1

Even if the company is allowed to operate as a monopoly, there can still be social welfare gain if price is regulated at the socially efficient level.

How can a monopoly benefit society?

Monopolies are able to charge high prices because they are the only supply. This harms consumer surplus, and therefore reduces social welfare.

If the prices that the monopoly charges can be limited to a socially efficient amount, then the society would benefit.

Find out more on monopoly pricing at https://brainly.com/question/13113415.

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