(25 points) The NCAA is often referred to as an \"incidental carte a. b. What is
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(25 points) The NCAA is often referred to as an "incidental carte a. b. What is a cartel and why is the NCAA It has been said that a cartel must rtel? referred to an "incidental" ca cartel and establish their own be guaranteed that some of its members do not "bolt' the cartel. What action on the part of the NCAA suggests that this was a potential problem, and how did the NCAA deal with this potential problem? What would be the consequences for intercollegiate sports if each student was paid his, o r hers marginal revenue product?Explanation / Answer
A cartel is a grouping of producers that work together in order to protect their interests. Cartels are created when a set of large producers decide to co-operate for their own interests. Once formed, cartels can fix prices for the members to avoid the competition on price.
The NCAA also known as the National Collegiate Athletic Association is a collection of schools that have come together to regulate the athletics of the intercolleges. A cartel here is a group of colleges which cooperate to exercise a market structire f monopoly or monopsony power over a market.
Cartels coordinate activities in order to fix the market prices, assign the output levels to members, divide profits, and erect barriers to entry for the outside members. The NCAA has done all of those things which incidentally making them into a cartel.
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