Please answer the following multiple choice question and explain why you select the choice. Thanks.

Question:

Telephone services used to be natural monopoly. Why? Is it a natural monopoly today? Can technology change what is and isn't a natural monopoly. choose the option that answers these questions.

A) Telephones used to be a natural monopoly because it was much cheaper for one firm to lay one set of lines and serve everyone than to have competing phone companies. Today cell phones have broken the natural landline monopoly because cell phones cost much less to create than telephone poles and wires so it makes sense to have multiple competing operators.

B) Telephone services have never been natural monopolies. the AC curve has always led below the demand line. Technological advances have reduced entry barriers.

C) Natural monopolies face lasting entry barriers and remain monopolies regardless technological changes. Telephone services operate as natural monopolies.

D) Technological changes have altered the average costs curve facing telephone services, transforming the telecommunication sector into an oligopoly market. Further, the demand has increased pushing the demand line rightwards. The AC curve now lies below the demand line.