A cartel is
A) a market structure with a small number of large firms.
B) a market structure with a large number of small firms.
C) a group of firms acting together to raise price, decrease output, and increase economic profit.
D) a market with only two firms.
E) another name for an oligopoly.

Question

Quizplus · Accepted Answer

A cartel is a group of firms that collude and work together to achieve higher profits by setting output restrictions and raising prices. They act as a monopoly by restricting output to drive up prices and maximize profits. Therefore, option C is the correct answer.

A Cartel Is