What term describes an illegal arrangement between businesses to set prices at a certain level?

The term that describes an illegal arrangement between businesses to set prices at a certain level is a cartel. A cartel is formed when independent firms in a competing industry come together to agree on prices, production levels, or market shares, effectively limiting competition. This practice often harms consumers by keeping prices artificially high and is considered illegal in many jurisdictions because it undermines the principles of a free and competitive market.

While collusion is a broader term that refers to any agreement between competitors to limit competition, cartels are a specific type of collusion focused on price-fixing and market control. Monopolies and partnerships do not describe this illegal pricing arrangement; a monopoly refers to a single firm dominating the market without competition, while a partnership involves two or more individuals collaborating to run a business together without necessarily restricting competition.