In the United States, why are cartels among firms usually kept secret?
What will be an ideal response?
Cartels are typically kept secret because they are illegal. In the United States and many other countries, it is illegal for firms to collude to form a cartel. It is illegal because firms collude in order to restrict output, raise prices, and capture consumer surplus so that they increase their economic profit.
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If the demand for a life-saving drug was perfectly inelastic and the price doubled, the quantity demanded would
A) also double. B) remain constant. C) decrease by 50%. D) be cut in half.
Refer to Table 2-18. What is Mickey's opportunity cost of making a hat?
A) 1/10 of an umbrella B) 1/5 of an umbrella C) 5 umbrellas D) 10 umbrellas
If the government puts price controls on medical care, this will increase the supply of affordable care in the United States
a. True b. False Indicate whether the statement is true or false
Refer to Figure 22.3 for a perfectly competitive firm. If the market price is $15,
A. The firm will have above-normal profits. B. Economic profits will be zero. C. The firm should produce 39 units. D. The firm should shut down.