which is the correct answer and why? thank you :) 24. Which of the following cha

Question

which is the correct answer and why? thank you :)

24. Which of the following characteristics do public goods donations, pricing decisions by oligopolists, and franchising decisions all have in common? a) The group successfully being able to collude (i.e. work together in the best b) The incentives of individual members of the group are not aligned with c) The individual members' strongest incentive is to promote the common d) Alternatives a) and c) are true, but b) is not true. interests of the group) is always socially efficient. what's best for the group as a whole. good of the entire group

Explanation / Answer

The correct choice is C

Explanation : - In public good donations, pricing decision by Oligopolists or franchising decisions each firms actions affects the other firms and the outcome is uncertain. Only when the firms collude i.e. promote the common good of the entire group , they will be acting like a monopoly and thereby maximizing the profits for the whole industry just like one firm.

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