When a cartel maximizes its profit
A) each firm necessarily produces the same amount.
B) the industry level of output is efficient.
C) industry marginal revenue equals industry marginal cost at the level of total output.
D) total output is greater than it would be without collusion.

Question

Quizplus · Accepted Answer

A cartel maximizes its profit when the industry marginal revenue equals the industry marginal cost at the level of total output, ensuring that the combined output is set where profit is maximized.

When a Cartel Maximizes Its Profit