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conditions and costs of a cartel

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1) What might a firm maximize revenue instead of profit?

2) Let's discuss cartel.
Discuss the conditions and costs of a cartel.
What conditions make OPEC a cartel?
Assess OPEC's viability.

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Solution Summary

Cartels are exemplified in this posting.

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1) What might a firm maximize revenue instead of profit?

The other revenue maximization method can be increasing the value perceived by customers with a differentiation strategy. This can help the sellers to charge a higher price for their products. However this strategy requires long term commitment to quality and brand awareness and firms need to invest heavily on R&D operations.

2) Let's discuss cartel.

A cartel is a group of producers that enters into a collusive arrangement to regulate pricing, production, or marketing of goods by members. The aim of this group is to restrict output in order to raise prices. Thus cartel members gain ...

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Umut Oltulu, MBA
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  • BSc, Dokuz Eylul University
  • MBA, Texas A&M University-Kingsville
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