Which of these will contribute to a cartel's stability? O a copyright brand differentiation ease of entry into an industry having few members with similar goals
Q: What is collusion? O A merger of two sellers O Regulatory restrictions on the entry of new sellers…
A: Collusion is when firms reduce the competitiveness of the market to earn higher profits which leads…
Q: a. What will happen to the equilibrium of the two company if they were to form a cartel and…
A: Below is the two nash equilibrium: First equilibrium, (60, 60)Second equilibrium, (30, 30)
Q: ustry. The demand curve for stophemes is given by p = 6,600 - 5q. h firm has one manufacturing plant…
A: Under cartel arrangement firms will act as a monopoly.
Q: QUESTION 10 Which statement is NOT true about OPEC? O a. OPEC is the Organization of Petroleum…
A: "Since you have asked multiple questions, we will solve first question for you .. If you want any…
Q: A kinked demand curve occurs when the demand curve is not a straight line but has a different…
A: In financial aspects, demand alludes to the number of items customers are willing and can stand to…
Q: 3. A cartel of copper producers has three plants, their cost functions are as follows: CT1 = 25 + 5Q…
A: Given, CT1 = 25 + 5Q 2/6CT2 = 38 + 2Q 5/10CT3 = 40 + 3Q ¼
Q: l quantity produced in the market. Each firm i faces the same lin C(q) = 2qi- %3D the total quantity…
A: *Answer:
Q: Consider an industry with two firms, each having marginal costs and total costs equal to zero. The…
A: Ans. 7. Given, MC = 0 P = 100 - Q We are given a choice as cartel. In…
Q: Is it possible to happen non-collusive behaviour i the price leadership model of Oligopolies ?
A: In Non- Collusive behavior of oligopoly is when each firm compete with each other and thus act…
Q: how conflicting affecting cartels and like cartels like opec fail to reachto consensus on price and…
A: A cartel is essentially an economic coalition of producers and manufacturers that aims to manipulate…
Q: Consider whether the promises and threats made toward each other by duopolists and oligopolists are…
A: Given that to imagine two firms play the game in sequence and each of them claim that if both it and…
Q: What is a difference between oligopoly and monopolistic competition? O Oligopolists consider the…
A: There are different market structures with different characteristics. These are perfect competition,…
Q: 2) Assume that there are 2 firms producing an identical product. Both firms have the same total cost…
A: Given : TC = q2 p=120-Q MC = 2q TR = p*Q TR = 120Q - Q2 MR = 120-2Q
Q: 6. Answer if this statement is true, false, or uncertain, and explain. Cartels that form almost…
A: Since you have asked multiple questions, we are answering the first one for you. If you want the…
Q: What is the objective of a cartel? joint profit maximization O productive efficiency O allocative…
A: A cartel is a group of firms that collude to dominate the market by agreeing upon the price and…
Q: 42. In the context of oligopoly, the kinked demand curve hypothesis is designed to explain A. O…
A: Under the oligopoly form of market, there exist a few sellers and a large number of buyers. The…
Q: The bigger a cartel (the more firms involved) the more difficult it is to sustain collusion because…
A: Cartel refers to the market situation when two or more firms are agree to collude and set the price…
Q: 5. A two-equal-size-firm cartel faces demand function Q = 20 - 2Pand each firm faces marginal cost…
A: Note:- Since we can only answer one question at a time and as the exact one is not specified, we'll…
Q: Consider the curve shown in the figure below, which shows the market demand, marginal cost, and…
A: Given: ATC=AVC=MC and Fixed costs =0
Q: 50 40 30 20 10 200 400 600 B00 1000 Quantity per period Suppose there are no fixed costs and…
A:
Q: 11. Suppose that the two biggest producers of gold, Bmine and Gmine, form a cartel to set price,…
A: When one player's strategy is superior than another player's strategy, regardless of how that…
Q: 2) Assume that there are 2 firms producing an identical product. Both firms have the same total cost…
A: Part a) Profit of firm 1 : Total revenue = 120 (q1 + q2 ) q1 = 120 q12 + 120 q2 q1 Profit = total…
Q: 2. Consider a duopoly market. Two firms are selling identical products and all costs are assumed to…
A: If the cartel is formed, then the two firms will together produce quantity of 4, at a price of 11,…
Q: d. Expectations grow that some members will cheat
A: A cartel is a group of firms that agree to coordinate their production and pricing decisions to reap…
Q: Cartels are often doomed to fail because.. O a. Cartels are illegal in most countries so firms are…
A: The oligopoly is a market type which is characterized by a large number of buyers and a few big…
Q: onsider the market for oil. Suppose for simplicity that there are only two oil roducing…
A: A cooperative game (or coalitional game) is a game in which groups of players ("coalitions") compete…
Q: Vhen they act as a profit-maximizing cartel, each company will produce nformation, each firm earns a…
A: A cartel is a formal organization of producers of a commodity with a purpose of increasing profits…
Q: If firm 1 will produce at the production level from (b) for sure, what is firm 2's optimal…
A: we have, Q=q1 +q2 Demand function=P=500-2Q or…
Q: The goal of a cartel is to and O increase prices; increase profits O increase prices; decrease…
A: A cartel is a group of producers of an item or service that has formed a legal agreement to manage…
Q: Explain why OPEC has been one of the most successful cartels in recent decades. What factors have…
A: OPEC stands for organization of the petroleum exporting counties. It is a group of 13 country and…
Q: Consider a town in which only two residents, Jacques and Kyoko, own wells that produce water safe…
A:
Q: Refer to the information provided in Figure 14.1 below to answer the question(s) that follow. Demand…
A: The correct answer is given in the second step.
Q: 4. Discuss why it is hard to enforce a cartel. Explain using words. DO NOT do any calculations. DO…
A: An oligopoly is a structure of the market that is being characterized by a few suppliers who are in…
Q: In a duopoly, suppose that the two firms set prices independently (Bertrand model). For each firm,…
A: Firm A's Reaction Curve : PA=30+0.25PB Firm B's Reaction Curve : PB=30+0.25PA For optimal prices, we…
Q: In an oligopoly market, it's always better off for companies if they would act Competitively and…
A: An oligopoly is a market structure in which few firms exert significant control over the market.…
Q: 145. If the firms in an oligopolistic industry can establish an effective cartel, the resulting…
A: When rival businesses in a given sector conspire to make formal, explicit agreements to fix pricing…
Q: Price $9 MC D. 500 700 900 Quantity Five firms in an industry have equal and constant marginal costs…
A: Given information There are 5 firms MC=5 which is constant for each firm. All 5 firms makes cartel.…
Q: rue or False: Based on the fact that both Dmitri and Frances increased production from the initial…
A: The following problem has been solved as follows:
Q: d. How much output would be produced if the market were monopolized? e. Suppose you and your rival…
A: d) in MONOPOLY, if q2 is zero Firm 1 is MONOPOLY, then q1 = 150, from BR1, where it hits x axis E)…
Q: A decentralized cartel consisting of three firms has an industry demand of P = 180-Q. The firms have…
A: If the firms competed, then both the firm's will try to maintain the lowest possible price inorder…
Q: Mobile companies operating in any country seem to have been maximizing their profits by acting like…
A: A cartel is a collection of firms who collude with each other in order to increase their profits.…
Q: 2. Which of the following is not characteristic of a cartel situation? (a) While disagreement over…
A: When cartels are formed then there are few sellers and a large number of buyers, in general cartels…
Q: When comparing two firms operating as a cartel/colluding and two firms competing in Cournot…
A: Cournot competition is an economic model. It is for describing an industrial structure in which…
Q: Sort each of the scenarios as to whether or not they are characteristic of price leadership. Assume…
A:
Q: The Competition Bureau in Canada wants to increase competition and reduce monopoly power. Thus it it…
A: Duopoly means only two firma are operating in the market for the product. Both firms are highly…
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- When OPEC raised the price of oil dramatically in the mid-1970s, experts said it was unlikely that the cartel could stay together over the long term-that the incentives for individual members. to cheat would become too strong. More than fort),r years later, OPEC still exists. Why do you think OPEC has been able to beat the odds and continue to collude? Hint: You may wish to consider non-economic reasons.Consider the curve in the figure below, which shows the market demand. marginal cost, and marginal revenue curve for firms in an oligopolistic industry. In this example, we assume firms have zero fixed costs. Suppose the firms collude to form a cartel. What price will the cartel charge? What quantity will the cartel supply? How much profit will the cartel earn? Suppose now that the cane] breaks up and the oligopolistic firms compete as vigorously as possible by cutting the price and increasing sales. What will be the industry quantity and price? What will be the collective profits of all firms in the industry? Compare the equilibrium price, quantity, and profit for the cartel and cutthroat competition outcomes.Breakdown of a cartel agreement Consider a town in which only two residents, Sean and Yvette, own wells that produce water safe for drinking. Sean and Yvette can pump and sell as much water as they want at no cost. For them, total revenue equals profit. The following table shows the town's demand schedule for water. Price Quantity Demanded Total Revenue (Dollars per gallon) (Gallons of water) (Dollars) 5.40 0 0 4.95 40 $198.00 4.50 80 $360.00 4.05 120 $486.00 3.60 160 $576.00 3.15 200 $630.00 2.70 240 $648.00 2.25 280 $630.00 1.80 320 $576.00 1.35 360 $486.00 0.90 400 $360.00 0.45 440 $198.00 0 480 0 Suppose Sean and Yvette form a cartel and behave as a monopolist. The profit-maximizing price is $ __________ per gallon, and the total output is __________ gallons. As part of their cartel agreement, Sean and Yvette agree to split production equally. Therefore, Sean's profit is $ __________ , and Yvette's profit is __________ .…
- 3. Breakdown of a cartel agreement Consider a town in which only two residents, Jake and Latasha, own wells that produce water safe for drinking. Jake and Latasha can pump and sell as much water as they want at no cost. For them, total revenue equals profit. The following table shows the town's demand schedule for water. Price Quantity Demanded Total Revenue (Dollars per gallon) (Gallons of water) (Dollars) 5.40 0 0 4.95 40 $198.00 4.50 80 $360.00 4.05 120 $486.00 3.60 160 $576.00 3.15 200 $630.00 2.70 240 $648.00 2.25 280 $630.00 1.80 320 $576.00 1.35 360 $486.00 0.90 400 $360.00 0.45 440 $198.00 0 480 0 Suppose Jake and Latasha form a cartel and behave as a monopolist. The profit-maximizing price is per gallon, and the total output is gallons. As part of their cartel agreement, Jake and Latasha agree to split production equally. Therefore, Jake's profit is , and Latasha's profit is . Suppose that Jake and…a. Explain what you know about collusion and cartels, including: definition, formation of motives, types and differences between these types, and so on. b. Why is this behavior often encountered in imperfectly competitive market structures such as oligopolies? c. What obstacles/obstacles do collusion and cartels often face? d. Name and explain at least 3 factors that can facilitate the occurrence of collusion and cartel!The Competition Bureau in Canada wants to increase competition and reduce monopoly power. Thus it it worries about industry concentration in Canada. Let's assume that the Canadian halibut processing industry there are only two firms(duopoly). Under such a market structure, if one of the halibut processing firm increases its price, then the other firm in the halibut processing industry can: keep the price of its processed halibut constant and thus increase its market share. keep its price of its processed halibut constant and thus decrease its market share. decrease its price of its processed halibut and thus decrease its market share. try to achieve economies of scale. increase its price of its processed halibut and thus increase its market share.
- 7. (Collusion and Cartels) Why would each of the following induce some members of OPEC to cheat on their cartel agreement? a. Newlyjoinedcartelmembersareless-developedcountries. b. The number of cartel members doubles from 12 to 24. c. International debts of some members grow. d. Expectations grow that some members will cheat.Explain why OPEC has been one of the most successful cartels in recent decades. Whatfactors have limited this success?4. Imagine a market with demand P = 420 – Q in each period. Two firms are thinking about colluding. They each have cost C(Qi) = 60Qi. If they cooperate and behave as a monopoly, then they have a marginal revenue curve, MRm = 420 – 2Q, and a marginal cost curve, MCm = 60. If they are in a cartel, then the firms will split the monopoly production and profits. If they compete, then they face MRi = 420 – 2Qi – Q-I and MCi = 60. a. If the firms stick to their agreement (cooperate), how much per-period profit do they each make? b. If they are not able to maintain their agreement (compete), what is their per-period profit? c. If one firm cheats on their agreement (deviate), how much does each firm make? Be sure to specify both the profit for the cheater and the firm cheated-on. d. Suppose the firms assume that their interaction will last forever (r = 1) and they share the common discount value R. What is the lowest value of R such that both firms are willing to continue with the cartel…
- just answer the subpart d a. Explain what you know about collusion and cartels, including: definition, formation of motives, types and differences between these types, and so on. b. Why is this behavior often encountered in imperfectly competitive market structures such as oligopolies? c. What obstacles/obstacles do collusion and cartels often face? d. Name and explain at least 3 factors that can facilitate the occurrence of collusion and cartel!4. Imagine a market with demand P = 420 – Q in each period. Two firms are thinking about colluding. They each have cost C(Qi) = 60Qi. If they cooperate and behave as a monopoly, then they have a marginal revenue curve, MRm = 420 – 2Q, and a marginal cost curve, MCm = 60. If they are in a cartel, then the firms will split the monopoly production and profits. If they compete, then they face MRi = 420 – 2Qi – Q-I and MCi = 60. d)Suppose the firms assume that their interaction will last forever (r = 1) and they share the common discount value R. What is the lowest value of R such that both firms are willing to continue with the cartel agreement described above?Consider a duopolistic market with an inverse demand curve P(Q) = 460 − 4Qand constant marginal costs for each firm that are given by MC(Q) = 10.Assume fixed costs are negligible. The two identical firms are competing in this market by choosing their production quantities simultaneously. In the equilibrium, each firm produces 37.5 units and the prevailing market price is 160. How would the joint profits of these two firms change if they successfully formed a cartel? Change in joint profits: ? (Enter your answer rounded to two decimal places; include a negative sign if appropriate.)