Last visit was: 19 Nov 2025, 01:34 It is currently 19 Nov 2025, 01:34
Close
GMAT Club Daily Prep
Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History
Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.
Close
Request Expert Reply
Confirm Cancel
User avatar
mbaaspirant80
Joined: 14 Apr 2017
Last visit: 26 Aug 2020
Posts: 246
Own Kudos:
385
 [19]
Given Kudos: 25
Location: India
sandeep : sharma
Concentration: International Business, Entrepreneurship
GPA: 3.9
Products:
Posts: 246
Kudos: 385
 [19]
Kudos
Add Kudos
19
Bookmarks
Bookmark this Post
Most Helpful Reply
User avatar
Sajjad1994
User avatar
GRE Forum Moderator
Joined: 02 Nov 2016
Last visit: 18 Nov 2025
Posts: 17,289
Own Kudos:
Given Kudos: 6,179
GPA: 3.62
Products:
Posts: 17,289
Kudos: 49,299
Kudos
Add Kudos
Bookmarks
Bookmark this Post
General Discussion
User avatar
ameyaprabhu
Joined: 28 Apr 2016
Last visit: 09 Aug 2017
Posts: 68
Own Kudos:
34
 [2]
Given Kudos: 79
Posts: 68
Kudos: 34
 [2]
1
Kudos
Add Kudos
1
Bookmarks
Bookmark this Post
User avatar
sasyaharry
Joined: 22 Nov 2016
Last visit: 11 Mar 2023
Posts: 199
Own Kudos:
342
 [3]
Given Kudos: 49
Concentration: Leadership, Strategy
Products:
2
Kudos
Add Kudos
1
Bookmarks
Bookmark this Post

Option E - True
Option C - False



First we need to find two options that work or are valid. Then we can pick the most true and most false statements.

Option A - No cartel will last more than 100 years. - Too strong a language. There might be cartels that will last more than 100 years but we might never know that. This is ambiguous, hence eliminate

Option B - As long as the members do not cheat, a cartel cannot be broken.- Again, too strong a language. this suggests a guarantee but the cartel can break for reasons other than members cheating , hence eliminate

Option C - An effective system for preventing members from cheating would not increase the likelihood that a cartel would survive in the long-term. – Correct! This is what the passage implies. Keep.

Option D - Private cartels are not legal in most countries. - Out of scope and hence eliminate.

Option E – Cartels are inherently unstable and likely to fail in the long run. – Correct! This is what the passage says. Keep.

Option F – It is extremely difficult for competing firms to agree to fix prices, marketing, and production in the formation of a cartel. - We are not concerned with competing firms and formation of cartel, hence eliminate

From the passage it is very evident that Option E - Cartels are inherently unstable and likely to fail in the long run is a strong candidate for 'true'.
Option C says if a system can prevent cheating, cartels still wouldn't survive. This is not really true, in fact this is false. There could be a slight increase in survival of cartels if an effective system is put in place. Hence this is false.
User avatar
mbaaspirant80
Joined: 14 Apr 2017
Last visit: 26 Aug 2020
Posts: 246
Own Kudos:
Given Kudos: 25
Location: India
sandeep : sharma
Concentration: International Business, Entrepreneurship
GPA: 3.9
Products:
Posts: 246
Kudos: 385
Kudos
Add Kudos
Bookmarks
Bookmark this Post
Dear All,
here below is answer with explanations.
The passage as a whole strongly suggests that few cartels last more than 4 or 5 years because of the
economic incentive that members have to cheat.
Option A - No cartel will last more than 100 years.
This is much too strong of a statement to be logically inferred from “very few known cartels have lasted
for more than 4 or 5 years.” It could be that one or more known (or unknown) cartels has indeed lasted
100 years, even though only 4 to 5 years is typical.
Option B - As long as the members do not cheat, a cartel cannot be broken.
This is too strong of a statement to be inferred from “The main issue is that the members of a cartel all
have an incentive to cheat and cut prices just a little in order to maximize their individual profits at the
expense of profits of the cartel as a whole.” There could be other issues. Perhaps new suppliers that are
not part of the market enter the cartel, or perhaps the cartel’s product is made technologically irrelevant.
Option C - An effective system for preventing members from cheating would not increase the
likelihood that a cartel would survive in the long-term. – Correct FALSE
The passage says that the main issue is that the members of the cartel have an incentive to cheat, so an
effective system for preventing cheating WOULD likely increase the likelihood that a cartel would survive
in the long run.
Option D - Private cartels are not legal in most countries.
The passage does not discuss legality. Although this statement is likely true, it is not something that can
be inferred from the passage.
Option E – Cartels are inherently unstable and likely to fail in the long run. – Correct TRUE
This can be directly inferred from “very few known cartels have lasted for more than 4 or 5 years” and
“The main issue is that the members of a cartel all have an incentive to cheat and cut prices just a little
in order to maximize their individual profits at the expense of profits of the cartel as a whole.” The
economic incentive to cheat is inherent in the nature of a cartel and makes it inherently unstable.
Option F – It is extremely difficult for competing firms to agree to fix prices, marketing, and
production in the formation of a cartel.
This choice is tempting, but the passage does not discuss the difficulty of forming a cartel agreement.
Although this statement is likely true in the real world, it is too extreme to infer language such as
"extremely difficult" from the passage.
Column 1: The correct answer is E.
Column 2: The correct answer is C. It is extremely difficult for competing firms to agree to fix prices,
marketing, and production in the formation of a cartel.
avatar
HarshG7
Joined: 08 Jul 2025
Last visit: 18 Nov 2025
Posts: 22
Own Kudos:
Given Kudos: 112
Posts: 22
Kudos: 4
Kudos
Add Kudos
Bookmarks
Bookmark this Post
i think there seems to be a problem with the revealed answers. i picked E for the "True" column and it showed me that my answer is incorrect, while the explanation suggests my answers were indeed correct
User avatar
Bunuel
User avatar
Math Expert
Joined: 02 Sep 2009
Last visit: 18 Nov 2025
Posts: 105,379
Own Kudos:
Given Kudos: 99,977
Products:
Expert
Expert reply
Active GMAT Club Expert! Tag them with @ followed by their username for a faster response.
Posts: 105,379
Kudos: 778,166
Kudos
Add Kudos
Bookmarks
Bookmark this Post
HarshG7
i think there seems to be a problem with the revealed answers. i picked E for the "True" column and it showed me that my answer is incorrect, while the explanation suggests my answers were indeed correct

The OA shows E as correct:


Attachment:
GMAT-Club-Forum-err3muly.png
GMAT-Club-Forum-err3muly.png [ 44.74 KiB | Viewed 663 times ]
avatar
HarshG7
Joined: 08 Jul 2025
Last visit: 18 Nov 2025
Posts: 22
Own Kudos:
Given Kudos: 112
Posts: 22
Kudos: 4
Kudos
Add Kudos
Bookmarks
Bookmark this Post
aight my bad. i misinterpreted it
Bunuel


The OA shows E as correct:


Attachment:
GMAT-Club-Forum-err3muly.png
Moderators:
Math Expert
105379 posts
496 posts