In order to be successful,a cartel must
A) find a way to encourage members to produce more than they would otherwise produce.
B) agree on the total level of production for the cartel, but they need not agree on the amount produced by each member.
C) agree on the total level of production and on the amount produced by each member.
D) agree on the prices charged by each member, but they need not agree on amounts produced.

Question

Quizplus · Accepted Answer

For a cartel to be successful, it must agree on the total level of production and on the amount produced by each member. This is because if each member agrees to produce an equal amount, the total production would be controlled and the prices can be increased to maximize profits. If members only agree on the total level of production, but not on the amount produced by each member, there is a risk of some members producing more than their allocated share, thereby undermining the cartel's efforts to control prices.

In Order to Be Successful,a Cartel Must