A natural monopoly is most likely to occur in industries where the costs of production are so high that a single firm can most efficiently supply the entire market. Examples of sectors that often manifest as natural monopolies include:
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Utilities - Such as water, electricity, and natural gas providers. The infrastructure costs and the need for extensive networks make it inefficient for multiple companies to operate in the same space.
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Public Transportation - Systems like subways or buses in a city, where operating multiple competing systems would lead to redundancy and inefficiency.
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Telecommunications - In certain regions, a single provider may dominate due to the high costs of laying down infrastructures, like fiber optics or cell towers.
In these cases, the barrier to entry for potential competitors is extremely high due to the substantial investments required.