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A very large international cartel that is allowed to exist, that is allowed to set prices,...

A very large international cartel that is allowed to exist, that is allowed to set prices, which every nation is forced to pay regardless is OPEC. According to OPEC (2017) , " OPEC is a permanent intergovernmental organization of 14 oil-exporting developing nations that coordinates and unifies the petroleum policies of its Member Countries". OPEC is a cartel that regulates oil prices so that consumers get a fair price. Supply is regulated from these oil producing countries in order to regulate the equilibrium price or market price. Recently we saw prices decreasing until we had the Hurricanes and drilling ceased for weeks and supply decreased. All of these factors play a role in the market price of oil and OPEC regulates this activity. Cartels are generally illegal but in some cases are allowed to exists. Cartels violate Antitrust.

What are antitrust laws?

Can you think of recent example of violations in the news?

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Answer #1

a. Anti trust laws are the laws developed to protect consumers and regulate how the companies regulate their businesses. the main aim of these laws is to ensure that fair competition exists in an open- market economy.

b. It was observed that few years back, the Microsoft had violated the anti-trust laws. If illegally tied the products together and unfairly expanded its monopoly power to drive the software competitors out of business. This was against fair competition in the market and led to violation of anti trust laws.

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