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<blockquote data-quote="SSS 18734" data-source="post: 4358090" data-attributes="member: 559710">Since you want us to correct you, I&#039;ll say that there are a few things wrong with your analysis.1) Supply is NOT getting low yet. Oil companies regularly limit production, which raises prices. That and ever-increasing demand.2) Gasoline is an inelastic good. Therefore, if any one company lowers prices,&nbsp; they would NOT make a ton of money, they would in fact, lose substantial sums of money. So your particular payoff matrix is a nice touch, but it doesn&#039;t really apply to the petroleum market. //content.invisioncic.com/y282845/emoticons/smile.gif.1ebc41e1811405b213edfc4622c41e27.gif3) The Sherman Act makes it illegal for U.S. firms to collude with each other. But it doesn&#039;t stop other countries and their oil industries from colluding. The oil industry colludes all the time (Think OPEC). //content.invisioncic.com/y282845/emoticons/wink.gif.608e3ea05f1a9f98611af0861652f8fb.gif</blockquote>

[QUOTE="SSS 18734, post: 4358090, member: 559710"] Since you want us to correct you, I'll say that there are a few things wrong with your analysis. 1) Supply is NOT getting low yet. Oil companies regularly limit production, which raises prices. That and ever-increasing demand. 2) Gasoline is an inelastic good. Therefore, if any one company lowers prices, they would NOT make a ton of money, they would in fact, lose substantial sums of money. So your particular payoff matrix is a nice touch, but it doesn't really apply to the petroleum market. [IMG]//content.invisioncic.com/y282845/emoticons/smile.gif.1ebc41e1811405b213edfc4622c41e27.gif[/IMG] 3) The Sherman Act makes it illegal for U.S. firms to collude with each other. But it doesn't stop other countries and their oil industries from colluding. The oil industry colludes all the time (Think OPEC). [IMG]//content.invisioncic.com/y282845/emoticons/wink.gif.608e3ea05f1a9f98611af0861652f8fb.gif[/IMG] [/QUOTE]

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