PRC-3 · Chapter 12 · Question 61 of 69
If oligopolistic firms successfully form a strict, secret cartel (collusion), the market outcome will closely resemble a monopoly, leading to:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Firms setting industry output where MR = MC, and collectively earning supernormal profits
Explanation
Collusion allows oligopolies to stop competing and act together as a single monopoly, setting a high price where industry MR=MC to guarantee maximum supernormal profits.
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