Table 17-2. The table shows the town of Pittsville's demand schedule for gasoline. For simplicity, assume the town's gasoline seller(s) incur no costs in selling gasoline.

-Refer to Table 17-2.If there are exactly three sellers of gasoline in Pittsville and if they collude,then which of the following outcomes is most likely?
A) Each seller will sell 166.67 gallons and charge a price of $1.33.
B) Each seller will sell 166.67 gallons and charge a price of $5.
C) Each seller will sell 200 gallons and charge a price of $4.
D) Each seller will sell 233.33 gallons and charge a price of $5.

Question

Table 17-2. The table shows the town of Pittsville's demand schedule for gasoline. For simplicity, assume the town's gasoline seller(s) incur no costs in selling gasoline.
 
-Refer to Table 17-2.If there are exactly three sellers of gasoline in Pittsville and if they collude,then which of the following outcomes is most likely?
A) Each seller will sell 166.67 gallons and charge a price of $1.33. 
B) Each seller will sell 166.67 gallons and charge a price of $5. 
C) Each seller will sell 200 gallons and charge a price of $4. 
D) Each seller will sell 233.33 gallons and charge a price of $5.

Quizplus · Accepted Answer

If the sellers collude, they will act like a monopoly, maximizing joint profits by reducing output and raising prices. Charging a price of $5 with reduced output aligns with this strategy.