Tacit collusion is difficult if:
A)there are many firms in the industry.
B)the firms in the industry are producing differentiated products.
C)firms have common interests.
D)the oligopolists are selling to many small firms.

Question

Quizplus · Accepted Answer

When there are many firms in the industry, it is difficult for them to reach an agreement and monitor each other's behavior, making tacit collusion unlikely. The more firms there are, the more difficult it becomes to coordinate actions and maintain an agreement.

Tacit Collusion Is Difficult If