Which of the Following Statements Is True Regarding the Service

question 72

Multiple Choice

Which of the following statements is true regarding the service contracts that the federal government has with private employees?

• A) The contracted services have been shown to save the government money.
• B) It is not clear how many people are working for the government on private contracts.
• C) The number of people working on private contracts has gone down over the past two decades.
• D) The number of privately contracted employees in the Defense Department increased during the Obama administration.
• E) Individuals employed through private contracts provide more security risks than government employees.

---

Definitions:

Cartel

An agreement between competing firms to control prices or exclude entry of a new competitor in a market, usually to increase market power and profits.

Formal Agreement

refers to a legally binding contract between parties that outlines specific obligations and rights.

Covert Collusion

A secret agreement between firms to fix prices, limit production, or engage in other practices to restrict competition illegally.

Kinked Demand Curve Model

An economic model suggesting that price competition among firms may be rigid because a firm raising its price does not lead to competitors following suit, while price decreases are matched. This results in a demand curve with a kink.