Question: Industry demand is given by: P = 150 - 3Q Cost curve for individual firm is given by: TC = 5qi + 2qi^2 Assume there

Industry demand is given by: P = 150 - 3Q

Cost curve for individual firm is given by: TC = 5qi + 2qi^2

Assume there are 2 firms in the industry A and B. Costs are the same for both firms.

Part A: Find price, output and profit given that it is a centralized cartel.

Part B: Find price, output and profit given that it is a decentralized cartel

As we know cheating is a problem with cartels what would happen to price and output if the cartel breaks down?

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