Answer: To enter a market to prevent a monopoly from abusing its customers
Explanation:
The government performs actions of economic regulation that affect the public (consumer) interests by controlling natural monopolies. A monopoly is when production is done by one or just a few companies. Some producers would use regulations to fix the price, block entry, and increase profits, so they must be regulated to avoid abuses.
Governments regulate natural monopolies to enter a market to prevent a monopoly from abusing its customers.
A monopoly is when there is only one firm operating in an industry. A natural monopoly occurs due to the high start-up costs or a large economies of scale. Natural monopolies are usually the only company providing a service in a particular region
Characteristics of natural monopolies
1. they have a large fixed cost
2. The firms have a low marginal cost
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