A cartel is a group of firms
A) acting separately to limit output, lower price, and decrease economic profit.
B) acting together to limit output, raise price, and increase economic profit.
C) legally fixing prices.
D) acting together to erect barriers to entry.
E) that compete primarily with each other rather than the other firms in the market.

Question

Quizplus · Accepted Answer

A cartel is a group of firms that act together to limit output, raise price, and increase economic profit. They collude and agree to restrict production to raise prices and profits. This behavior is often illegal and violates antitrust laws.

A Cartel Is a Group of Firms