Consider the market for Picasso paintings. Assume that there are four galleries that sell Picasso paintings and they have formed a cartel. Further assume that there are a limited number of Picasso paintings in existence, making it difficult for new galleries to acquire Picasso paintings and enter this market. This makes the cartel $$ sustainable.

The most$-$favoured$-$customer $($MFC$)$ policy discourages firms from $-$ prices in the face of reduced demand.Consider the market for Picasso paintings. Assume that there are four galleries that sell Picasso paintings and they have formed a cartel. Further assume that there are a limited number of Picasso paintings in existence, making it difficult for new galleries to acquire Picasso paintings and enter this market. This makes the cartel $$ sustainable.

The most$-$favoured$-$customer $($MFC$)$ policy discourages firms from $-$ prices in the face of reduced demand.