Author Question: When firms in an industry are selling similar products, and they agree to share the market, A) ... (Read 55 times)

elizabeth18 · **on:** Jun 29, 2018

When firms in an industry are selling similar products, and they agree to share the market,

A) each firm earns a profit even though marginal cost is greater than marginal revenue.
B) each firm secures a net revenue about as large as it would have received if it were the only seller.
C) they try to keep each firm's price above its marginal cost.
D) they tend to produce higher prices and larger output.
E) the agreement will enforce itself because none of the firms will have an interest in triggering a competitive struggle.

Question 2

The average (mean) price of ten commodities is 330. If an eleventh commodity whose price is 600 is included in the calculation, the new average is:

A) 254.54.
B) 354.54.
C) 330.35.
D) 450.25.