Suppose That It Is Relatively Easy for New fiRms to Enter

question 42

Multiple Choice

Suppose that it is relatively easy for new firms to enter an industry. Some of the firms in this industry want to form a cartel. Which of the following is likely to be true?

• A) It would be relatively easy for the firms to form a cartel.
• B) The market power of the cartel is likely to be low.
• C) The industry exhibits substantial economies of scale.
• D) The marginal cost of production in this industry is likely to be low.

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Definitions:

Social Support

The perception or reality of assistance and solidarity available from others, especially during times of stress or need.

Stable

Consistent and unchanging over time.

Social Cognitive Psychologist

A professional in psychology who studies how people's thoughts, feelings, and behaviors are influenced by observing others, as well as by their interactions in social contexts.

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The environment or circumstances in which an individual, creature, or vegetation exists or functions.