The maximum total economic profit that can be made by colluding duopolists
A) exceeds the economic profit made by a monopolist.
B) bears no necessary relation to the economic profit made by a monopolist.
C) is less than the economic profit made by a monopolist.
D) equals the economic profit made by a monopolist.

Question

Quizplus · Accepted Answer

Colluding duopolists effectively act as a monopoly by setting production levels and prices to maximize joint profits, thus their maximum total economic profit equals that of a monopolist.

The Maximum Total Economic Profit That Can Be Made by Colluding