Explain how uniformity can reduce price competition by strengthening cartels or increase price competition by reducing product differentiation.

/in /by

1. Explain how uniformity can reduce price competition by strengthening cartels or increase price competition by reducing product differentiation. 2. Competition drives prices down to costs, whereas monopolies price above cost. California banks have paid large damages for allegedly charging fees greater than the cost of certain services that they provide. Suppose a car manufacturer charges an additional $450 for an automatic transmission in a new car. What inefficiencies would result if the consumer could sue the manufacturer and make the company prove that $450 is not disproportionately above the actual cost of the automatic transmission?