Which One of the Following Factors Increases the Likelihood That

question 167

Multiple Choice

Which one of the following factors increases the likelihood that a cartel agreement will lead to higher profit for cartel members?

• A) free entry into the cartelized market
• B) a small number of sellers involved in the cartel agreement
• C) the cartel members produce a differentiated product
• D) highly unstable demand for the product produced by the cartel

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Definitions:

Fixed Costs

Costs that do not change with the level of output produced by the firm, such as rent, salaries, or loan repayments.

Positive Reinforcement

A method in behavior psychology where a positive stimulus is presented after a desired behavior, increasing the likelihood of that behavior in the future.

Desirable Behaviour

Actions or conduct that are considered favorable or appropriate in a particular context.

Frequency

A measure of how often an event occurs.