Which of the following is NOT a characteristic of a cartel?

A cartel is a formal agreement among competing firms to control prices, limit production, and enhance their market power. The characteristics of a cartel typically include:

• Agreement on prices: Cartels agree on specific price points to maximize profits for all members involved and eliminate competition on pricing.

• Coordination of production levels: Members of a cartel often coordinate how much to produce to avoid oversupply in the market, which can drive prices down.

• Collaborative marketing efforts: Cartels may work together on marketing strategies to enhance demand for their products while controlling market dynamics.

Independent pricing strategies do not align with the fundamental nature of a cartel. One key feature of a cartel is the collective effort to set prices; thus, if members were to pursue independent pricing strategies, it would undermine the cartel’s goals and could lead to competition among the members, leading to reduced control over the market. Therefore, independent pricing strategies is not a characteristic of a cartel.