To Maximize Joint Profits,a Cartel Must Determine the Level of Output

question 37

Multiple Choice

To maximize joint profits,a cartel must determine the level of output at which:

• A)joint marginal revenue equals the marginal cost of the largest member of the cartel.
• B)marginal revenue equals joint marginal cost.
• C)the horizontally sum of the members marginal cost curves is at a minimum.
• D)joint marginal revenue equals the marginal cost of the smallest member of the cartel.

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Definitions:

Gross Profit

The financial metric calculated as sales revenue minus the cost of goods sold, indicating the efficiency of a company in producing and selling its goods.

Sales Discounts

Reductions in the sales price offered by a seller to a buyer, often to prompt early payment or bulk purchases.

Accounts Receivable Turnover Ratio

A financial metric indicating how efficiently a company collects cash from its credit customers by measuring how often receivables are collected during a period.