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:

DSM

Short for Diagnostic and Statistical Manual of Mental Disorders, it is a handbook used by healthcare professionals as the authoritative guide to diagnose mental disorders.

Cigarette Smoking

The act of inhaling and exhaling the smoke of burning tobacco encased in cigarettes, often leading to addiction and health risks.

Gambling Disorder

A behavioral addiction characterized by a continuous or periodic loss of control over gambling, preoccupation with gambling and money with which to gamble, irrational thinking, and a continuation of the behavior despite adverse consequences.

Cocaine

A powerful stimulant drug derived from the leaves of the coca plant, known for its addictive potential.