Which of the following is likely to hurt the success of a cartel? - the market demand faced by the cartel is somewhat inelastic - cartel members have cost advantages over non-cartel members in the same market - cartel supplies all (or nearly all) of the market's output of the good or service - cartel members expect to interact for a short period of time

Two firms are engaged in Cournot (simultaneous quantity) competition. Market-level inverse demand is given by P = 160 − 4Q Firm 1 has constant marginal costs of MC1 = 8, while Firm 2 has constant marginal costs of MC2 = 24.           1) Does there exist a low enough positive marginal cost for firm 1 such that firm 1 acts like a monopoly in this market, if so what is the MC if not why?

In cases where a cartel controls access to a key production input, firms in the cartel: have less incentive to cheat for fear that they will be cut off from the key input. will always have an incentive to cheat on the agreement, as cheating increases profits. are typically good at finding ways to access the key input outside the cartel. will never cheat on the cartel agreement.

please explain in steps

Q16 Suppose we are referring to OPEC, the oil cartel. Which would make it easier to maintain an effective collusive agreement among OPEC members? Multiple Choice   the emergence of a number of potential entrant firms   a decrease in the elasticity of demand for the OPEC's oil    a new method of pricing that makes it more difficult for cartel members to determine the prices at which other cartel members are selling oil   an increase in the number of substitutes for the oil produced by the OPEC cartel   a pledge of allegiance to the cartel

Which of the following statements about tacit collusion is true? a) It may result in firms making less than maximum profit b) It can lead to price wars c) It involves allocating a production quota to each firm d) A cartel is an example

Which of the following methods could a cartel NOT use to prevent its member fırms from breaking their agreements? If a member fırm breaks its agreement, it is a breach of contract and the firm is subject to legal penalties. The cartel acts as a monopolist, maximizing the combined profits of all the member firms. All of the other choices could be used to prevent member firms from breaking agreements. The cartel requires member firms to structure executive pay in such a way that the executives benefit personally from preserving the cartel. If a member firm breaks its agreement, that firm is kicked out of the cartel permanently and can no longer earn cartel profits in the future.

Which of the following would be most likely to contribute to the breakdown of a cartel in a natural resource (e.g., bauxite) market? Group of answer choices high prices low price elasticity of demand high compatibility of member interests unequal member ownership of the natural resource

Cartels have a difficult time maintaining their output agreements because an individual firm has an incentive to deviate (increase their output) from the arrangement.  T/F