Which of the following legal restrictions, if enforced effectively, would be likely to solve a prisoners' dilemma type of problem for the firms involved?
A) A law that prevents a cartel from enforcing rules against cheating
B) A law that makes it illegal for oligopolists to engage in collusion
C) A law that prohibits firms in an industry from advertising their services
D) All of the above would be likely to solve a prisoners' dilemma for the firms.

Question

Quizplus · Accepted Answer

Prohibiting advertising can reduce competitive pressures, allowing firms to maintain higher prices without fear of losing market share, thus solving the prisoners' dilemma by reducing incentives to undercut each other.

Which of the Following Legal Restrictions, If Enforced Effectively, Would