Collusion results when a group of firms
i.act separately to limit output,lower prices,and decrease economic profits.
ii.act together to limit output,raise prices,and increase economic profits.
iii.in the United States legally fix prices.
A) i only
B) ii only
C) iii only
D) i and iii
E) ii and iii

Question

Quizplus · Accepted Answer

Collusion is an anticompetitive behavior where firms act together to limit output, raise prices, and increase economic profits. Therefore, the correct choice is ii only. Option i is incorrect because it describes firms acting individually, not colluding. Option iii is incorrect because fixing prices is illegal in the United States under antitrust laws.

Collusion Results When a Group of Firms