Suppose the Firms in a Competitive Industry Form a Cartel

Multiple Choice

Suppose the firms in a competitive industry form a cartel to reduce the price of one of the inputs they purchase.Which of the following will result from this collusive behavior?

A) The firms will employ fewer units of the input whose price they want to reduce.
B) The firms will substitute other inputs for the input whose price they want to reduce.
C) The price of the firms' final product will increase.
D) The firms will be able to earn lower profits.