Use the Following to Answer Question(s): Monopoly Through Collusion

question 74

Multiple Choice

Use the following to answer question(s) : Monopoly Through Collusion

-(Exhibit: Monopoly Through Collusion) The exhibit illustrates the situation in an industry that consists of two firms facing identical demand curves; the demand curve for each firm is D₁.Which of the following assumptions is part of the analysis illustrated by the model?

• A) The two firms have identical marginal cost but different average total cost.
• B) The two firms sell differentiated products.
• C) The MR curve is not relevant to either firm's choices.
• D) If the firms cooperate by acting as a cartel, they can maximize their combined economic profit.

---

Definitions:

Trust

A confidence that others will provide benefits and/or not harm you, even if they may be tempted to do otherwise.

Conformity

The act of matching attitudes, beliefs, and behaviors to group norms or societal expectations.

Layman's Terms

An expression used to describe the simplification of complex technical or specialized language into terms understandable by the general public.

Dining in Groups

The social activity of eating meals together with a number of people, which can influence food choices and consumption behaviors.