He has written for various print and online publications and wrote the book, "Appearances: The Art of Class." Evans holds a Bachelor of Arts in organizational communication from Rollins College and is pursuing a Master of Business Administration in strategic leadership from Andrew Jackson University. A natural monopoly arises when a single firm can produce a good or service at a lower cost and supply them at a lower price than if other two or more companies were involved in producing it. A near pure monopoly occurs when one firm has a market share in excess of 90 percent. One company dominates because competitors cant afford to enter the industry. The nature of the market is that no close competitor or substitute exists. A natural monopoly is a legal monopoly that occurs because of high start-up costs or economies of scale. 6:35 Save Autoplay 98K views Examples The most. Even if they can enter the industry, competitors may not have consistent access to the resources they need to provide the products or services at a competitive price. This is known as a natural monopoly and most typically refers to public utilities such as water services, natural gas, and electricity. One company dominates because competitors can't afford to enter the industry. The firm effectively is the industry in this situation. A natural monopoly is a legal monopoly that occurs because of high start-up costs or economies of scale. To put it simply, a business organization is said to have a natural monopoly when it supplies a certain kind of product or service to an entire market and does. Keith Evans has been writing professionally since 1994 and now works from his office outside of Orlando. According to, a natural monopoly by definition is: Situation where one firm (because of a unique raw material, technology, or other factors) can supply a market’s entire demand for a good or service at a price lower than two or more firms can. A pure monopoly is a single supplier within a defined market or industry.
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