Question

Question 1 In the lectures videos, we identified three tasks any collusive arrangement or cartel would need to accomplish if they were going to be successful in raising price above the competitive level for an extended period of time. List these three tasks and describe why each task is important in the cartel’s efforts to keep price above the competitive level (that is, discuss the role each plays in getting and/or maintaining a higher than competitive price).

Question 2

A cartel can also work to limit other forms of competition, such as advertising, hiring rules, geographic limitations on sales, etc. In the United States and Canada, the NCAA (National Collegiate Athletic Association) is an organization that oversees regulations regarding athletics at universities and colleges. College football and basketball programs generate billions of dollars every year. The NCAA enforces strict limits on the compensation universities can offer when recruiting student-athletes to their campus. Many observers disagree with these restrictions, while others approve these restrictions.

To summarize, consider these two viewpoints.

1. Some people will argue that the NCAA puts these strict rules on athlete compensation in order to maintain amateur status of these students. After all, less than 1% of the college athletes impacted by these restrictions will ever play in the National Football League or the National Basketball Association.
2. Others argue that the NCAA is nothing more than a cartel that restricts members from competing away large amounts of revenue by paying athletes market-driven wages.

There is no one correct answer. Your assignment is to pick one of these viewpoints, write a brief essay in support of it, and conclude with a short statement of why you think the alternative (the viewpoint you did not choose) is weaker.

Answer 1

Solution:1

Firstly, the lecture video is unavailable here and without watching that video how we can particularly comment or list that these are the 3 tasks described.

Nonetheless, I can mention few tasks which I know that are important for a cartel to keep the price above the competitive levels.

1. With the help of creating and using political pressure keep the prices above the monopoly levels.

2. Entering into binding agreements which will allow to keep the price above the competiitive levels.

3. Keeping the prices above the worls prices.

4. Operating in the zones where demand is highly inelastic, because this will earn them fruits in the short run, whereas iin the long run when the demand becomes elastic prices also comes down to competitive levels.

5. Creating demand volatilization in the market and creating barriers to entry in the market.

These are the few possible tasks which can be or are used y the cartels to keep the prices above the competitive level.

However, due to unavailability of the lecture video as given in the question, we cannot present that particular tasks that has been listed in the video without watching it, which is not available.

If it is possible you can provide us the link of that video so that we can give the answer the question in a much more concise manner and in a particular directioon.