Which of the following statements is correct? A) If duopolists successfully coll

Question

Which of the following statements is correct?

A) If duopolists successfully collude, then their combined output will be equal to the output that would be observed if the market were a monopoly.

B) Although the logic of self-interest decreases a duopoly’s price below the monopoly price, it does not push the duopolists to reach the competitive price.

C) Although the logic of self-interest increases a duopoly’s level of output above the monopoly level, it does not push the duopolists to reach the competitive level.

D) All of the above are correct.

A) If duopolists successfully collude, then their combined output will be equal to the output that would be observed if the market were a monopoly.

Explanation / Answer

D) All of the above are correct.

Duopoly is a form of market in which there exist only two sellers who have control over the market. These two firms divide the output which is produced under monopoly among themselves.

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