Respuesta :
It is true that without government regulations, natural monopoly can earn positive profit in short run.
What is a natural monopoly?
A natural monopoly is a monopoly in which total cost of a firm to produce its total output is less than the other two firms in the market producing the same item together.
In other words a firm producing goods having lower cost in the whole market together.
Regulation of monopolies:
The government requires to regulate monopolies for the customers and their interest because monopoly is have power to set the price higher than in the competitive market.
How the government regulate monopolies?
- Price capping
- regulation of Meggers
- breaking up the monopolies
- nationalisation government ownership.
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