Collusion is undesirable and illegal because
A. Government intervention leads to inefficient outcomes.
B. It is unprofitable and the government must bail out firms that are bankrupted by collusion.
C. Resources are misallocated and the level of output is restricted.
D. It leads to greater production than would occur in a competitive market.
Answer: C
You might also like to view...
Which of the following was NOT an issue that the United States. had with the Kyoto Protocol?
a. Major U.S. trading partners (such as China and India) are exempt from the provisions—not fair! b. Europe's targets were set ridiculously low. c. We don't really know if pollution causes global warming. d. There are less costly ways to deal with environmental problems.
A fall in the real exchange rate (appreciation) will decrease the trade balance in the short run and cause a(n) ___ of the total demand curve.
a. downward shift b. increase in the slope c. upward shift d. decrease in the slope