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A monopoly is broken into a number of competitive parts. Predict the changes in output and price which are likely to take place.
Making the basic assumptions that,
1) The individual parts of the monopoly will function as subsidiaries;
2) Both are supposed to be profit maximisers; and
3) The monopoly had no advantages of scale, then the sum of the individual PMC firms MC curves will equivalent market supply curve - and be identical to the monopoly s MC curve.
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