Scenario 16-1 Assume That the Countries of Irun and Urun Are the Are

Multiple Choice

Scenario 16-1
Assume that the countries of Irun and Urun are the only two producers of crude oil. Further assume that both countries have entered into an agreement to maintain certain production levels in order to maximize profits. In the world market for oil, the demand curve is downward sloping.
-Refer to Scenario 16-1.As long as production levels are less than the Nash equilibrium level,both Irun and Urun have the individual incentive to

A) hold production levels constant.
B) decrease production.
C) increase production.
D) increase price.