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Suppose that the market demand for mountain spring water is given as follows: P = 1200 - Q Mountain spring water can be produced at

Suppose that the market demand for mountain spring water is given as follows:

P = 1200 - Q

Mountain spring water can be produced at no cost, so MC=0.

Suppose that there is only one firm in the market.Marginal revenue for a monopolist is given by MR = 1200 - 2Q.

Profit maximizing price in this market is 600.

How much profit could each firm earn if they formed a cartel?

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