When firms in an industry reach an agreement to fix prices,divide up market share,or otherwise restrict competition,they are using the strategy of:

Question

Quizplus · Accepted Answer

Collusion is the strategy used by firms in an industry to fix prices, divide up market share, or otherwise restrict competition through agreements. Limit pricing involves setting prices low enough to discourage new entrants into the market. Interindustry competition refers to competition between firms in different industries, while price leadership involves one dominant firm in an industry setting prices that others follow. Therefore, D is the best choice as it directly relates to the scenario described in the question.

When Firms in an Industry Reach an Agreement to Fix