Which of These Statements About Cartel Pricing Power Is True

question 23

Multiple Choice

Which of these statements about cartel pricing power is true?

• A)The more inelastic the market-demand for the cartel's product, the lower will be the price that the cartel members can charge to maximize profits.
• B)The higher the piling up of unsold inventories, the higher will be the price set by the cartel members.
• C)The larger the share of world production controlled by the cartel, the higher will be the price set by the members.
• D)The greater the elasticity of supply of the non-cartel members, the higher will be the price set by the cartel members.

---

Definitions:

Binding Arbitration

A dispute resolution process where an impartial third party makes a decision that is legally binding on both sides involved in the dispute.

Zero-Sum Game

A situation in which one party’s gain is exactly balanced by another party's loss, ensuring that the total value in the system remains unchanged.

Wage Increases

Adjustments to employees' salaries, typically upward, often as a result of negotiations between employers and employees or their representatives.

Safety Standards

Regulations and guidelines designed to ensure the health and safety of workers in their workplace environment.