When oligopoly firms collude to raise prices,

Question

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When oligopoly firms collude to raise prices, they are essentially reducing competition and increasing their profits. However, this comes at the cost of consumers who have to pay higher prices for the same goods/services. This reduces consumer surplus and can lead to a reduced quantity of goods/services being produced. Ultimately, while the colluding firms benefit from the increased profits, society as a whole loses out on the benefits of competition, which include lower prices, increased quantity, and innovation.

When Oligopoly Firms Collude to Raise Prices