Author Question: The two tendencies of a firm in a cartel are the incentive to: a. cheat to maximize joint profits ... (Read 83 times)

james0929 · **on:** Jun 30, 2018

The two tendencies of a firm in a cartel are the incentive to:
a. cheat to maximize joint profits and the incentive to raise prices.
b. cheat and avoid collusion and the incentive to raise price to maximize the firm's share of profits.
c. increase output in order to minimize per-unit cost and the incentive to reduce price in order to maximize joint profit.
d. cooperate to maximize joint profits and to cheat on the agreement in order to increase the firm's share of the profit.

Question 2

Applying a price of labor to the law of diminishing returns generates:
a. the law of increasing costs.
b. less output as more labor is hired.
c. differences in the quality of labor.
d. a negatively-sloped labor supply curve.
e. specialization and the division of labor.