If the Sellers in the Cigarette Industry Formed a Cartel

question 194

Multiple Choice

If the sellers in the cigarette industry formed a cartel and decided to set price along a straight-line downward-sloping demand curve, which point would they choose if they wanted to gain the highest total revenue?

• A)The point nearest the vertical axis, where the price is highest.
• B)The point nearest the horizontal axis, where quantity demanded is greatest.
• C)One of the points higher up on the demand curve, where demand is elastic.
• D)One of the points lower down on the demand curve, where demand is inelastic.
• E)The point of unit elasticity, in the middle of the demand curve.

---

Definitions:

Coral Reefs

Underwater ecosystems characterized by reef-building corals, which are colonies of tiny living animals found in marine waters that contain few nutrients.

Biological Indicators

Organisms or components of organisms that are used to assess the health of a natural ecosystem or the presence of pollutants.

Bathyal Zone

A region of the ocean depths ranging from 200 to 2,000 meters below the surface, characterized by its limited light penetration and distinct marine life.

Phytoplankton

Microscopic plant-like organisms that live in aquatic environments, capable of photosynthesis, and form the base of the oceanic food chain.