Use the following to answer questions:
Figure: Demand 1
-(Figure: Demand 1) A successful cartel facing the market in this diagram would cause the industry price to:
A) decrease from $8 to $4.
B) increase from $4 to $8.
C) increase from $7 to $8.
D) increase from $4 to $7.

Question

Use the following to answer questions:
Figure: Demand 1 
-(Figure: Demand 1) A successful cartel facing the market in this diagram would cause the industry price to:
A) decrease from $8 to $4. 
B) increase from $4 to $8. 
C) increase from $7 to $8. 
D) increase from $4 to $7.

Quizplus · Accepted Answer

A successful cartel would restrict output, causing the market supply curve to shift to the left. This shift in supply would result in a higher market price, which would increase from $4 to $7. Therefore, the correct answer is D, increase from $4 to $7.

Use the Following to Answer Questions