Which of the Following Statements Regarding Cartels Is FALSE

question 38

Multiple Choice

Which of the following statements regarding cartels is FALSE?

• A) Cheating by cartel members is less profitable and easier to detect if there are fewer firms in the industry.
• B) New entrants can be prevented when the cartel-controlled good is limited in supply.
• C) Cartels should control natural resources that are rare and more valuable.
• D) Cartels are more successful if they are backed by government and the power of the law.

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Definitions:

Purchasing Bicycles

Refers to the consumer activity of buying bicycles, which could involve considerations of cost, quality, and utility.

Transaction

An exchange or transfer of goods, services, or funds between two or more parties, often involving a contractual agreement.

Gains And Loses

Refers to the increases or decreases in economic benefit, typically associated with investments or transactions.

Informed Exchange

A transaction where all parties involved have access to essential information relevant to the trade or deal.