If all the ﬁrms in an oligopoly agree to co-operate, their joint proﬁts will be maximized if they act as one monopolist.

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When all firms in an oligopoly co-operate and act as one monopolist, they can collectively control the market and restrict output to raise prices, resulting in higher joint profits. This is known as a collusive oligopoly or a cartel. However, such agreements are illegal in many countries and difficult to maintain due to incentives for individual firms to cheat and produce more than their agreed-upon quotas.

If All the ﬁRms in an Oligopoly Agree to Co-Operate