Given an Oligopolistic Industry Characterized by a Collusive Agreement and Constant

question 27

Multiple Choice

Given an oligopolistic industry characterized by a collusive agreement and constant unit costs of production, which of the following statements is true?

• A)As the number of firms expands, the incentive to cheat on the collusive agreement increases.
• B)As the number of firms falls, aggregate output falls and aggregate profit rises.
• C)As the aggregate output rises, aggregate profit does not change.
• D)As the number of firms expands, aggregate output rises and aggregate profit falls.

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