Question

Which statement is false? A monopoly sells lower-quality products at higher prices than in a perfect competition. Natural monopolies are necessary to avoid wasteful duplication of resources. Collusion is legal in the United States, but cartels are not. The start-up costs in a monopolistically competitive industry are low. Homogeneous products leave consumers with no choice.

Answer 1

Following statement is false :

• The start-up costs in a monopolistically competitive industry are low.

Answer 2

The correct answer is C) Collusion is legal in the United States, but cartels are not.

The statement that is false is "Collusion is legal in the United States, but cartels are not."

Collusion is illegal in the United States, as well as in other countries. Collusion means to deceive others, such as in a conspiracy or secret agreements. Often the purpose of collusion is to limit or avoid competition from other companies. A Cartel is also illegal in the United States under the anti-trust law. Cartels want to control production, price, and sale, and restrict competition in its industry.