To collude and maximize profits, the two firms must behave as if they were in _____ market.

Question

Quizplus · Accepted Answer

To collude and maximize profits, the two firms must behave as if they were a single entity, which is characteristic of a monopoly market. In a monopoly, one firm controls the entire market, allowing it to set prices to maximize profits, similar to how collusion between firms in an oligopoly might aim to achieve the same outcome.

To Collude and Maximize Profits, the Two Firms Must Behave