After reading this chapter, my views on what I thought might be a natural monopoly changed. For example, the US Postal Service, I thought of as a natural monopoly. It is actually a legal monopoly. It is legally protected by the government, therefor has the upper hand on the prices they charge. For example, they sell stamps, if they increase the price of stamps, you will more than likely have to pay the increased priced stamp.
Water companies are a example of a regulated monopoly. They choose to give these companies the monopoly so that there weren’t multiple companies trying to run the pipes in a town to supply water to everyone. They also did this because they can put a price cap on it and people aren’t charged a outrageous amount for their water. That is where the government regulated part comes into play. I think if multiple water companies were competing in one town, the price would go up to a certain point and then level out.
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