QUESTION 36In 2018, a few countries want to join together to restrict the oil supply to the world market. Together, these countries' exports of oil account for 80% of the total global trade. What would they be trying to accomplish? They are attempting to form a cartel, increase their joint output, and control a larger percentage of the total global trade. They are attempting to price discriminate between consumers of their exported oil, thereby increasing their share of the global trade and increasing their joint profits. They are attempting to form a cartel, jointly restrict output, and increase the world price of oil. They are attempting to act as a bloc to restrict entry of new producers to the world market, and thereby protect their joint profits.

A cartel is a business entity formed from the collusion of independent market agents with the motive…

Answered: In 2018, a few countries want to join…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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QUESTION 36

In 2018, a few countries want to join together to restrict the oil supply to the world market. Together, these countries' exports of oil account for 80% of the total global trade. What would they be trying to accomplish?

		They are attempting to form a cartel, increase their joint output, and control a larger percentage of the total global trade.
		They are attempting to price discriminate between consumers of their exported oil, thereby increasing their share of the global trade and increasing their joint profits.
		They are attempting to form a cartel, jointly restrict output, and increase the world price of oil.
		They are attempting to act as a bloc to restrict entry of new producers to the world market, and thereby protect their joint profits.

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