What is the difference between explicit collusion and implicit collusion?
What will be an ideal response?
Explicit collusion involves making an agreement about not competing. In implicit collusion no formal agreement is reached, but firms tacitly avoid competing with each other.
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Absent any violations of the first welfare theorem, the competitive equilibrium is efficient.
Answer the following statement true (T) or false (F)
Which of the following examples, ceteris paribus, will cause a rightward shift in the aggregate demand curve for the United States?
a. The nation’s general price level decreases. b. American consumers lose confidence in the economy. c. American consumers take on higher levels of debt. d. The nation’s population increases.
Which country has a surprising life expectancy, and why?
a. Japan has the highest life expectancy even though it ranks only fourth in real GDP per capita.
b. Nigeria has an unexpectedly high life expectancy for a country with a low real GDP
per capita.
c. Brazil has a very low life expectancy even though its real GDP per capita is in the
middle of this list.
d. The United States has a higher life expectancy than one might expect from its real
GDP per capita.
Which of the following statements is true?
A) Optimizers with the highest opportunity cost of time push up the rental price of apartments with the highest commute time. B) Optimizers with the lowest opportunity cost of time push up the rental price of apartments with the lowest commute time. C) As the rental prices of downtown apartments rise, only workers with the highest opportunity cost of time will be willing to rent them. D) As the rental prices of downtown apartments rise, only workers with the lowest opportunity cost of time will be willing to rent them.