Gary's Gas and Frank's Fuel are the only two providers of gasoline in their small town.Gary and Frank decide to form a cartel to raise the price of gasoline.The total industry profits are highest when _____ cheat(s) on the agreement,and Gary's profits are highest when _____.
A) neither firm;neither firm cheats on the agreement
B) neither firm;Gary cheats but Frank does not
C) both firms;Gary cheats but Frank does not
D) both Gary and Frank;both Gary and Frank cheat
Correct Answer:
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Q36: The owners of the gas stations in
Q37: Collusive agreements are typically difficult for cartels
Q39: _ occurs when the only two firms
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