Multiple Choice
Recall the application about the failure of the salt cartel,why did the salt cartels around the 19th century fail to get established,even though they paid new firms not to produce salt for a year?
A) Individual firms cheated on the cartel by selling outside the cartel.
B) Artificially high price also caused new firms to enter the market.
C) Salt consumers found substitutes and brought the price of salt down.
D) A and B are correct.
Correct Answer:
Verified
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