A Reason Why It Is Difficult for Developing Countries to Maintain

question 21

Multiple Choice

A reason why it is difficult for developing countries to maintain a cartel is that

• A) the elasticity of demand for a cartel's output decreases over time.
• B) producers in the cartel have an economic incentive to cheat.
• C) economic profits discourage other producers from entering the industry.
• D) producers in the cartel have the motivation to lower prices but not to raise prices.
• E) tariffs allow producers in the cartel to produce items that make no profit.

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Definitions:

Child Abuse

The physical, sexual, emotional mistreatment, or neglect of a child by a parent, guardian, or caregiver.

Genuine Consent

An agreement or approval provided freely and willingly without any form of coercion, pressure, or undue influence.

Annulment

A court decree that invalidates (nullifies) a marriage. Although the marriage itself is deemed non-existent, children of a marriage that is annulled are deemed legitimate.

Terminated

Ended or concluded, often used in the context of employment to indicate that a worker's job position has been ended by the employer.