Firms Will Have a Greater Incentive to Cheat on a Collusive

question 186

Multiple Choice

Firms will have a greater incentive to cheat on a collusive agreement when

• A)the number of sellers is relatively small
• B)total market sales are small
• C)the market is perfectly competitive
• D)demand is rapidly changing
• E)prices are known to all firms in the market

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Definitions:

Capital To Labor Ratio

A measurement of the amount of capital employed per unit of labor, often used to understand the level of mechanization or technology used in production.

Capital Goods

Goods that are used in producing other goods, rather than being bought by consumers directly, such as machinery, tools, and buildings used in production.

Economic Growth

An increase in a nation's production of goods and services, measured by its gross domestic product (GDP) over time.

Consumer Goods

Items produced for personal consumption by individuals and households.