The levels of profits in a cartel are
A) initially high,but then decrease as substitute goods emerge.
B) initially low,but then decrease as the level of competition increases.
C) initially low,but then increase as the level of competition increases.
D) near the monopoly level of profits.
E) zero.

Question

Quizplus · Accepted Answer

Cartels are formed to act like a monopoly and increase their profits. Therefore, the levels of profits in a cartel are near the monopoly level of profits.

The Levels of Profits in a Cartel Are