What is the name for a group of firms that have a formal agreement to collude to
ID: 1166307 • Letter: W
Question
What is the name for a group of firms that have a formal agreement to collude to produce a monopoly output and sell it at the monopoly price? Select one: a. Corporation b. Cartel c. Cooperative d. Limited partnership
Monopolistic competitive firms are similar to perfectly competitive firms in that: Select one: a. both types of firms face barriers to entry b. both types of firms have zero profits in the long run c. both types of firms sell differentiated products d. both types of firms face a downward sloping demand curve
Explanation / Answer
What is the name for a group of firms that have a formal agreement to collude to produce a monopoly output and sell it at a monopoly price?
Answer- CARTEL
It is an association of firms with a purpose of maintaining prices high and restricting competition. It's generally related to an oligopoly market.
Monopolistic competitive firm's are similar to perfectly competitive firm's in that:
Answer--b. Both types of firms have zero profits in the long run.
Both firms will get normal profits in the long run. The AC will be equal to AR curve in the long run and they get zero or normal profits in the long run.
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