Explain Why Collusion Is Likely in an Industry in Which

question 49

Essay

Explain why collusion is likely in an industry in which it is difficult to get information about transactions and the market, the market operates on a continual basis, and there are a few sellers.

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Definitions:

Trading Securities

Financial instruments like stocks or bonds held by a firm, primarily for the purpose of selling them in the near term to realize a gain.

Long-term

Pertaining to or occurring over an extended period, often exceeding one year, in the context of investments, loans, or planning.

Profit Margin

A financial ratio that measures the percentage of revenue remaining after all expenses have been deducted from sales.

Net Income

A company’s remaining income after total revenue has had taxes, expenses, and costs deducted from it.