Suppose Acme and Mega produce and sell identical products and face zero marginal and average cost. Below is the market demand curve for their product.Suppose Acme and Mega decide to collude and work together as a monopolist with each firm producing half the quantity demanded by the market at the monopoly price. If Mega cheats on the agreement by reducing its price to $1 while Acme continues to comply with the collusive agreement, then Mega will then sell ________ units and Acme will sell ________ units.

A. 100; 0
B. 150; 50
C. 150; 0
D. 100; 50

Answer: C

Economics

You might also like to view...

The employer who has the most unionized workers is the:

A. government. B. auto industry. C. airline industry. D. trucking industry.

Economics

Why does the economy’s aggregate demand curve have a negative slope?

What will be an ideal response?

Economics