If a differentiated product is produced, it would cause a shared firm or cartel to be unstable.

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If a differentiated product is produced, it would lead to product differentiation and price competition, which would destabilize a shared firm or cartel. Each firm would try to differentiate its product to maintain a competitive edge, leading to price wars and lower profits for the cartel as a whole. This would make it difficult for the cartel to maintain its pricing and production levels, causing it to become unstable.

If a Differentiated Product Is Produced, It Would Cause a Shared