Assume that the leading firms in an industry combine to carry out a common policy in their interests, but that they keep their own, separate identities. Such a combination is usually known as a

trust
cartel
joint-Stock company
pure monopoly

The correct answer is: B. cartel

A cartel is a formal agreement among competing firms to coordinate their actions in order to achieve a common goal, such as increasing profits or controlling prices. Cartels are often illegal, but they can be very effective in raising prices and reducing competition.

A trust is a type of business organization in which the controlling interest in a company is held by a small group of trustees. Trusts were once common in the United States, but they have since been largely replaced by other forms of business organization, such as corporations.

A joint-stock company is a type of business organization in which ownership is divided into shares that can be bought and sold. Joint-stock companies are the most common form of business organization in the world.

A pure monopoly is a market structure in which there is only one seller of a good or service. Pure monopolies are rare, but they can occur when a company has a natural monopoly, such as a utility company that owns the only water or electricity lines in an area.

In the case of the leading firms in an industry combining to carry out a common policy in their interests, but that they keep their own, separate identities, the correct answer is a cartel. This is because a cartel is a formal agreement among competing firms to coordinate their actions in order to achieve a common goal, such as increasing profits or controlling prices.

Exit mobile version