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Unformatted text preview: perfect competition (assume firm/country is covering at least AVC) if cartel is organized to raise price then industry Quantity must be cut back, by fixing quotas for each supplier in the case of OPEC each country set a quota if each country is allocated a quantity, at price 1, the new demand curve facing the firm is demand 1 (which is simply a slice of the industry demand curve) restrains trade Price Leaders...
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- Spring '08