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There Are Four Ice Cream Shops on a Small Tourist

Question 132

Multiple Choice

There are four ice cream shops on a small tourist island. The accompanying table shows the quantity of ice cream cones that each firm produces in a typical year and the price that each firm currently charges for each ice cream cone it sells. An economist might suspect __________ collusion occurring in this market where __________ is the price leader and all other firms set price to match the price leader.  Firm  Quantity  ?rice  Black Squirel Cones 1,383$2.85 Frozen Delight 2,410$2.89 Vanilla Emporiun 27,377$2.99 Scoop Shack 670$3.05\begin{array}{lrr}\text { Firm }&\text { Quantity }&\text { ?rice }\\\text { Black Squirel Cones } & 1,383 & \$ 2.85 \\\text { Frozen Delight } & 2,410 & \$ 2.89 \\\text { Vanilla Emporiun } & 27,377 & \$ 2.99 \\\text { Scoop Shack } & 670 & \$ 3.05\end{array}


A) explicit; Scoop Shack
B) explicit; Vanilla Emporium
C) illegal; Vanilla Emporium
D) tacit; Scoop Shack
E) tacit; Vanilla Emporium

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