Principles of Microeconomics, 7th Edition

Published by South-Western College
ISBN 10: 128516590X
ISBN 13: 978-1-28516-590-5

Chapter 17 - Part V - Oligopoly - Quick Check Multiple Choice - Page 366: 2

Answer

Option C.

Work Step by Step

When a cartel co-operates, they become price makers. To maximize profits, they will sell a limited number of resources and fix the price of their product. And so, because they are price makes, they will produce at quantities that are lower than that of perfect competition, which in this case is equal to the quantity produced in a monopoly.
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