-Refer to Figure 12.1.Assume the firms have formed a cartel.If the cartel is maximizing profits,the cartel's profits are

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The cartel maximizes profits by acting as a monopoly, producing where marginal cost equals marginal revenue. From the figure (not visible here, but based on typical economics principles), the profit-maximizing quantity and price can be determined. The area representing total profits is the rectangle formed by the price level above average total cost times the quantity produced. Without the specific figure, we use common knowledge that cartels aim to maximize profits by reducing output and increasing prices compared to competitive outcomes, leading to positive profits.