Answer to Question 1
There are two main reasons why firms may refrain from colluding. First, the nature of competition predicts that although the firms may have a verbal agreement that they will both set high prices, they may still engage in secret price cutting to capture more of the profits for themselves. Thus, although collusion is a great deal for oligopolists, it is difficult to sustain. Second, price fixing is illegal. The potential punishment for engaging in such actions has a strong discouraging effect.
Answer to Question 2
D
J. P. Morgan, the financial genius, staved off ruinous competition among steel firms by combining mo
Firms Incorporated into U.S. Steel
Cultures Ideal Body Types
The Number of Children Americans Think Are Ideal
Competitive firms and maximization
For the circuit in Figure 1, assume ideal diodes. The peak inverse voltage is approximately