Collusion is most likely to occur when
A)there are many firms in an industry.
B)firms participate in a market sporadically.
C)firms compete and interact over a long period of time.
D)it is difficult to obtain information about other firms.
E)firms have very little information about each other.

Question

Quizplus · Accepted Answer

Collusion requires firms to have an opportunity to interact over a period of time in order to coordinate their behavior. When firms have a history of interacting, they may develop trust and understanding of each other's practices and be more likely to collude.

Collusion Is Most Likely to Occur When