Which of the following is not a necessary condition for a successful cartel?
A) an increasing demand for the product
B) agreement by all firms to abide by the decisions of the cartel
C) control over a major portion of the industry's production
D) an elastic demand curve for the product

Question

Quizplus · Accepted Answer

An elastic demand curve is not necessary for a successful cartel. In fact, a cartel would prefer inelastic demand, as it allows them to raise prices without losing significant sales.

Which of the Following Is Not a Necessary Condition for a Successful