Cartel Members Have an Incentive to Cheat on the Cartel

question 113

Multiple Choice

Cartel members have an incentive to cheat on the cartel because:

• A) the cartel does not maximize profits.
• B) the cartel price is the competitive price.
• C) each member's output quota is too high.
• D) each member's MR is not equal to the cartel's MC.
• E) the industry profit would be higher under competitive conditions.

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Definitions:

Employee Output

This term refers to the quantity and quality of work produced by an employee within a given time period.

Organizational Productivity

The measure of how efficiently and effectively a company or organization utilizes its resources to achieve its goals.

Job Description Approval

The process by which a job description is formally reviewed and ratified by relevant authorities or departments within an organization.

Supervisory Approval

The process of obtaining formal consent or agreement from a supervisor or higher authority within an organization, often required for implementing decisions or changes.