Which of the Following Industrial Characteristics Makes a Collusion Difficult

question 36

Multiple Choice

Which of the following industrial characteristics makes a collusion difficult but leads to competition? 

• A) Existence of few firms in the industry 
• B) Existence of an industry price leader 
• C) Lack of market commonality 
• D) High barriers of entry

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Definitions:

Herfindahl-Hirschman Index

An indicator used to assess the degree of market concentration and establish the intensity of industry competition.

Oligopolist

A market participant in an oligopoly, a market structure dominated by a small number of large firms, influencing pricing and competition.

Cartel

An association of independent businesses organized to control production, pricing, and marketing of goods to limit competition.

Competitors

Entities or firms in the same industry or market that offer similar goods or services to consumers.