When the firms in an oligopoly are in a cooperative equilibrium and are maximizing their joint profits,which of the following statements is true?

Question

Quizplus · Accepted Answer

In a cooperative equilibrium, firms in an oligopoly act like a monopoly, maximizing joint profits, leading to monopoly profits (A). An individual firm can increase its profits by cheating on the agreement (B). Price (P) is greater than marginal cost (MC) for each firm (C), and marginal revenue (MR) equals MC, not greater (D). Therefore, all statements are true.

When the Firms in an Oligopoly Are in a Cooperative