If an Oligopolist Is Part of a Cartel That Is

question 11

Multiple Choice

If an oligopolist is part of a cartel that is collectively producing the monopoly level of output, then that oligopolist has the incentive to increase production with the aim of

• A)increasing prices.
• B)increasing profits for the group of firms as a whole.
• C)increasing profits for itself, regardless of the impact on profits for the group of firms as a whole.
• D)decreasing costs of production.

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Definitions:

Cookies

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Price Elasticity of Demand

The degree to which the quantity demanded of a good changes in response to a change in its price.

Quantity Sold

The total number of units of a product or service sold over a specific period of time.

Substitutes for Salt

Alternative ingredients or products used to replicate the taste or preservative qualities of salt in cooking and food preparation.