Suppose tuition fees for a university increase from £3,000 to £9,000. After the increase, enrolment drops by 5%. e) Explain why setting up a cartel and maintaining collusion may be difficult in general. f) Explain how a maximum tuition fee of £9000 imposed by the government may facilitate collusion between universities.

Suppose tuition fees for a university increase from £3,000 to £9,000. After the increase, enrolment drops by 5%. e) Explain why setting up a cartel and maintaining collusion may be difficult in general. f) Explain how a maximum tuition fee of £9000 imposed by the government may facilitate collusion between universities.

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter25: Government And Product Markets: Antitrust And Regulation

Section: Chapter Questions

Problem 12QP

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