Cartels Do Not Last Because Their Members Find Them Difficult

question 133

Multiple Choice

Cartels do not last because their members find them difficult to maintain since:

• A) each of the member firms can attain lower costs outside the cartel.
• B) each firm in the cartel can gain from secret price cuts.
• C) all the firms prefer an expansion in industry supply.
• D) all the firms face less elastic demand curves when outside the cartel.

Understand the effects of governmental fiscal policy on the economy.

Comprehend the impact of currency valuation changes on exports and imports.

Identify the challenges in implementing fiscal policy.

Recognize how monetary policy affects economic investment.

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Definitions:

Current Assets

Assets that can be converted into cash within one fiscal year or an operating cycle.

Property, Plant, And Equipment

Long-term tangible assets held for business use and not expected to be converted to cash in the upcoming fiscal year, including land, buildings, machinery, and vehicles.

Accounts Receivable Turnover

A financial ratio that measures how efficiently a company collects revenue from its credit sales, by dividing net credit sales by the average accounts receivable.

Days' Sales

An indicator of a company's efficiency in managing its inventory, it calculates the number of days it typically takes to sell the entire inventory.