Which One of the Following Factors Reduces the Likelihood That

question 1

Multiple Choice

Which one of the following factors reduces the likelihood that a cartel agreement will lead to higher producer profit?

• A) significant barriers to entry into the cartelized market
• B) the development of substitutes for the good produced by the cartel
• C) government restrictions that limit competition from new rivals
• D) a small number of sellers involved in the cartel agreement

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Definitions:

Scarce Resources

Natural or human resources that are limited in supply and cannot fulfill all wants and needs due to their finite availability.

Free Lunch

An idiom expressing the idea that it is impossible to get something for nothing; in economics, it refers to the impossibility of getting a benefit without a cost.

Scarce

Limited in availability relative to the demand.

Taxpayers

Individuals or entities that are required to pay taxes to a government body, based on their income, property, or purchases.