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There Are Four Jet Ski Rental Companies on a Small

Question 130

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There are four Jet Ski rental companies on a small tourist island.The following table shows the quantity of Jet Skis that each firm rents in a typical year and the per-hour price that each firm currently charges for each Jet Ski it rents.If Nautical Jet Skis raised its price to $60.25 and all other firms subsequently increased their prices by $10.00,all firms have There are four Jet Ski rental companies on a small tourist island.The following table shows the quantity of Jet Skis that each firm rents in a typical year and the per-hour price that each firm currently charges for each Jet Ski it rents.If Nautical Jet Skis raised its price to $60.25 and all other firms subsequently increased their prices by $10.00,all firms have   A)  likely participated in explicit price collusion and they all have broken antitrust laws. B)  still broken antitrust laws,even if they might not have participated in explicit price collusion. C)  likely participated in tacit collusion and they all have broken antitrust laws. D)  likely participated in tacit collusion and they have not broken antitrust laws because tacit collusion is not illegal. E)  likely participated in tacit collusion and the government can improve social welfare by banning Jet Ski rentals on the island.


A) likely participated in explicit price collusion and they all have broken antitrust laws.
B) still broken antitrust laws,even if they might not have participated in explicit price collusion.
C) likely participated in tacit collusion and they all have broken antitrust laws.
D) likely participated in tacit collusion and they have not broken antitrust laws because tacit collusion is not illegal.
E) likely participated in tacit collusion and the government can improve social welfare by banning Jet Ski rentals on the island.

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