What do you understand by a natural monopoly? Why are public utilities usually natural monopolies?

A natural monopoly arises when a single firm can produce and supply goods or services to an entire market at a lower cost than multiple competing firms. This situation occurs due to significant economies of scale, where the average cost of production continues to decline as output increases. In such industries, competition is inefficient because multiple firms would have to duplicate costly infrastructure, leading to higher overall costs. Natural monopolies often exist in industries that require substantial initial investment, such as electricity distribution, water supply, telecommunications, and railway networks.  

The fundamental characteristic of a natural monopoly is high fixed costs and low marginal costs. The firm incurs massive upfront costs in setting up infrastructure, but once the infrastructure is in place, the cost of serving an additional consumer is relatively _________ __________ ____ ___ __________ ______ ______ _________ ______ _________ __________.
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