One of the Reasons Cartels Are Considered Unstable Is That

question 121

Multiple Choice

One of the reasons cartels are considered unstable is that

• A)member firms reduce their investment,thereby becoming uncompetitive over time.
• B)it is inefficient to manage individual firms collectively.
• C)there are wide fluctuations in price as cartel members vary their output.
• D)consumers seek out substitutes to the cartel product.
• E)individual members of the cartel have an incentive to violate the cartel agreement.