Which of the Following Have Greater Incentives to Collude and to Form

question 58

Multiple Choice

Which of the following have greater incentives to collude and to form cartels in an effort to achieve monopoly-like profits?

• A) monopolists
• B) workers in a competitive labor market
• C) monopolistic competitors
• D) firms in a perfectly competitive market
• E) oligopolists

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Definitions:

Positive Externalities

Benefits that affect parties who did not choose to incur that benefit.

Pareto Optimal

A state of distributing resources that precludes the possibility of augmenting the status of any participant or preference without detriment to another.

Positive Externalities

Benefits that are enjoyed by a third-party or society as a whole as a result of an economic transaction or activity, without them directly paying for it.

Utility Function

A mathematical representation that describes how consumers rank preferences among different commodity bundles.