What Is the Incentive for a Firm to Join a Cartel

question 152

Multiple Choice

What is the incentive for a firm to join a cartel?

• A)to be able to earn profits in the long run but not in the short run
• B)to be able to earn larger profits than if it was not part of the cartel
• C)to completely insulate itself from competition
• D)to produce a larger amount of output than if it was not part of the cartel

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Definitions:

Chesapeake

A region around the Chesapeake Bay, mainly within Maryland and Virginia, known for its significant history in early American colonization and seafaring.

Seventeenth Century

The seventeenth century encompasses the period from January 1, 1601, to December 31, 1700, marked by significant historical, cultural, and scientific developments including the Enlightenment and colonial expansion.

Indentured Servants

People who were bound by contracts to work for another person for a specified period of time, often in exchange for travel expenses, food, and accommodation.

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Very small or insufficient amounts of pay received for work done, often highlighting issues of poverty and economic inequality.