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Abnormal profit
When a firm's average revenue is greater than its average costs.
Economies of scale
Reductions in average production costs that arise when a firm increases its output by scaling up all its inputs in the long run.
Market power
The degree to which a firm in a market is able to control its output price.
Natural monopoly
A monopoly that can serve the entire market at a lower average cost than if the market were divided among smaller firms. This occurs when the total market demand is small enough for the monopoly to benefit from economies of scale, keeping its long-run average costs falling.