Which of the following is (are) true?
A) It is difficult to determine how much tacit collusion exists in a particular industry.
B) It is often seen that prices of firms in perfect competition are different.
C) The fact that one firm changes its price shortly after another firm is proof of tacit collusion.
D) A and B are true.

Question

Quizplus · Accepted Answer

It is difficult to determine the existence and extent of tacit collusion because it is not overt and explicit like explicit collusion, making it hard to prove.

Option B is false because in perfect competition, firms have access to the same information and technology, and are selling identical products, resulting in the same prices.

Option C is also false because a firm changing its price shortly after another firm's change doesn't necessarily mean they're colluding; it could be a response to market changes or signals.

Which of the Following Is (Are) True