Two firms exhibiting cournot behavior have proposed to merge

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Two firms exhibiting Cournot behavior have proposed to merge. The resulting firm would account for about fifty percent of the market. It is widely expected that the price will rise as a result of the merger. The firms claim that the merger is in society's interests becausc costs will decline. Given that the price will rise, is there any merit in the firms' argument? Explain.

Reference no: EM131101221

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