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7. Suppose, the firms agreed to form a cartel: a. Assuming both firms produce, what would be the equilibrium output and profits of each firm?

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7. Suppose, the firms agreed to form a cartel: a. Assuming both firms produce, what would be the equilibrium output and profits of each firm? Why might it be rational for the cartel to agree for only one firm to produce but share the profits? 7. Suppose, the firms agreed to form a cartel: a. Assuming both firms produce, what would be the equilibrium output and profits of each firm? Why might it be rational for the cartel to agree for only one firm to produce but share the profits

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