The Puerto Rico Electric Power Authority (PREPA) is a natural monopoly. The graph shows the market demand curve and the firm's marginal cost curve. The monopoly is unregulated and maximizes profit. Draw the firm's marginal revenue curve. Label it MR. Draw a point at the profit-maximizing price and quantity. Label it 1. The monopoly makes a positive economic profit. Draw the firm's average total cost curve. Label it ATC. Draw a point on the ATC curve at the quantity produced. Label it 2. Draw shapes that show

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Monopoly Market

When a company and its products dominate a sector or an industry, it is termed a monopoly. When a firm and its products control a market, then it is called a monopoly.