The likelihood of a cartel being successful is greater when:

A) firms are producing a differentiated,rather than a homogeneous,product.
B) cost and demand curves of various participants are very similar.
C) the number of firms involved is relatively large.
D) the economy is in the recession phase of the business cycle.

Cartel Success

The effectiveness of a cartel, a group of independent market participants who collude to raise prices and restrict output, in achieving its objectives of maximizing the profits of its members.

Differentiated Product

A good or service that is distinct from its competitors through variation in design, function, or quality.

Business Cycle

The fluctuations in economic activity that an economy experiences over a period of time, characterized by phases of growth (expansion) and decline (recession).