Answer
A natural monopoly is when a single company can supply a good to an entire market at lower costs than multiple firms could supply for the same cost.
Work Step by Step
A smaller market is more likely to have a natural monopoly since the monopoly could likely meet all of the demand in the smaller market. However, as the market grows (or as the demanded good starts to be more heavily used), meeting the entire demand of the market might require another firm to enter the market.