Solved

Suppose There Are Only Five Construction Companies in a Particular

Question 122

Multiple Choice

Suppose there are only five construction companies in a particular region that are each large enough to take on large public infrastructure projects (roads,bridges,sewers,etc.) .Representatives of these companies meet regularly for coffee or on the golf course and agree on which company will submit the lowest bid for a particular project.This type of firm behaviour is an example of


A) cooperative behaviour that results in higher output and lower prices.
B) cooperative behaviour that results in increased consumer welfare.
C) tacit collusion,and is legal as long as output is not restricted.
D) predatory pricing,and is meant to prevent new entrance to the industry.
E) explicit collusion and is illegal.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents