Price fixing is prohibited under section 1 of the Sherman Act because

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    when firms collude to engage in monopoly pricing competition is reduced and a deadweight loss occurs in the market.
     when firms collude and fix prices consumer surplus is lost and replaced by producer surplus as firms are able to sell the same output levels at higher prices.
     a uniform price in the marketplace is a sign of limited competition and the presence of deadweight loss.
     Both 1 and 2.
asked Jun 2, 2013 in Economics by anonymous
    

1 Answer

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when firms collude to engage in monopoly pricing competition is reduced and a deadweight loss occurs in the market.
answered Jun 3, 2013 by Xyz ~Expert~ (3,650 points)

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