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Which statement is correct if firms want to sustain tacit collusion? The less patient the firms are, the easier the collusion can be sustained. Firms

Which statement is correct if firms want to sustain tacit collusion?

  • The less patient the firms are, the easier the collusion can be sustained.
  • Firms need to trade-off between the immediate gain from deviation and the future losses of punishment.
  • The higher the losses from punishment, the harder the collusion can be sustained.
  • The lower the gain from deviation, the harder the collusion can be sustained.

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