Final answer:
Firms collude in cartels to restrict output and keep prices high, similar to a monopoly, to increase their profits, but this is often illegal due to antitrust laws. The correct answer is option c.
Step-by-step explanation:
Firms may attempt to collude together in the form of a cartel to act collectively to restrict output and keep prices higher. This behaviour mimics that of a monopoly, where the collaborating firms can control the supply, inflate prices, and share the ensuing profits. Such practices, however, often face legal challenges as they can be considered anticompetitive and are generally outlawed by antitrust laws. For instance, authoritative bodies have mechanisms to prevent companies from openly forming a cartel to significantly reduce competition through higher prices and lower outputs. Despite this, companies might resort to less direct forms of collusion which can still be subject to legal scrutiny.