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The Table Below Shows Annual Profits Received by Two Oligopolists

Question 49

Multiple Choice

The table below shows annual profits received by two oligopolists, Alpha and Beta, depending on whether each company decides whether to live within the collusive agreement they have signed to charge a high price, or to cheat and charge a lower price.

beta’s Strategies AlPHA’sStrategies  Don’t   Cheat  Don’tCheat B: $5 m A: $5 m B: $6 m A $3 m B: $3 m B: $4 m Cheat $6 m A: $4 m\begin{array}{}& \text {beta's Strategies }\\ \text {AlPHA'sStrategies }&\begin{array}{|l|c|c|}\hline & \begin{array}{c}\text { Don't } \\\text { }\end{array} & \text { Cheat } \\\hline \text { Don'tCheat} & \begin{array}{c}\text { B: } \$ 5 \mathrm{~m} \\\text { A: } \$ 5 \mathrm{~m}\end{array} & \begin{array}{c}\text { B: } \$ 6 \mathrm{~m} \\\text { A } \$ 3 \mathrm{~m}\end{array} \\\hline & \begin{array}{c}\text { B: } \$ 3 \mathrm{~m}\end{array} & \text { B: } \$ 4 \mathrm{~m} \\ \text { Cheat } & \$ 6 \mathrm{~m} & \text { A: } \$ 4 \mathrm{~m} \\\hline\end{array}\\\end{array}
-Anti-combines legislation in Canada was largely unsuccessful prior to 1986 because:


A) it combined criminal and civil provisions
B) Canadian governments placed supreme importance on domestic competition
C) its penalties were too extreme
D) it was difficult to establish the guilt required to prove a criminal offence
E) it led to so many convictions that it became highly controversial

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