Collusive Agreements Between Two Firms Are Most Likely to Be

question 162

Multiple Choice

Collusive agreements between two firms are most likely to be honored when the game

• A) is a one-time game with the opportunity for a prisoner's dilemma.
• B) has a Nash equilibrium that differs from the outcome that maximizes the payoffs to the two firms.
• C) is a zero-sum game.
• D) is repeated and both firms offer credible threats if the other violates the agreement.

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