If a Duopoly Collusive Agreement Is Made That Maximizes Joint

question 73

Multiple Choice

If a duopoly collusive agreement is made that maximizes joint profit,

• A)each of the duopolists has no incentive to cheat on the agreement.
• B)each duopolist has the incentive to cheat on the duopoly agreement by lowering the price.
• C)each duopolist has the incentive to cheat on the agreement by increasing the price to make monopoly profit.
• D)there is no concern over the entrance of new firms because they cannot decrease the duopolists' profit.
• E)the dominant strategy is to collude.

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