Collusion between two firms occurs when
A) announce that each will match its rival's market price.
B) firms explicitly or implicitly agree to adopt a uniform business strategy.
C) the firms independently pursue strategies that could hurt each other.
D) firms act altruistically to bring about the economically efficient outcome.
B
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When Pepsi becomes more expensive relative to other beverages, people will purchase less Pepsi. This observation is known as the:
a. diamond-water paradox. b. law of diminishing marginal utility. c. substitution effect. d. income effect.
An expansionary fiscal policy:
a. may include reductions in taxes. b. may include discretionary increases in transfer payments. c. may include increases in government spending. d. All of the answers are correct.
Which organization acts as a forum for countries to come to agreement on trade policies and resolve trade policy disputes?
a. the International Trade Organization b. the United Nations c. the World Trade Organization d. the United Nations Conference on Trade and Development
If a bank deposit will double in value in 18 years, the rule of 72 implies that the interest rate on the deposit must equal is approximately:
A. 8 percent. B. 6 percent. C. 4 percent. D. 3 percent.