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What options do the other members of the cartel

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Reference no: EM132288560

Let's say that your firm would like to set up a cartel with your competitors.

a) Does U.S. antitrust law allow you to form a cartel? Does it allow your firm to discuss pricing issues with your competitors?

b) Now put antitrust issues aside. Assume that the firms reach an agreement on price and quantities. Do you expect the firms to abide by their promises? Why or why not?

c) Assuming that one of the cartel members cheats, what options do the other members of the cartel have to punish the cheater?

d) Is it better for a firm in the industry to be a member of the cartel or to be outside of the cartel?

Reference no: EM132288560

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