1. The following table gives some cost components for a perfectly competitive firm. Fill the table calculating the missing short-run costs. Calculate the profit-maximising output of the firm assuming the following respective market prices: P-50, 60, 90, 120, 150, 180, 240, 300, and 400. 2. 3. 5. Q 0 1 2 3 4 5 6 7 8 9 10 FC 300 0 VC 100 150 210 290 400 540 720 950 1240 1600 TC AVC ATC Using diagrams for both the industry and a representative firm, illustrate competitive long- run equilibrium. Assuming constant costs, employ these diagrams to show how (a) an increase and (b) a decrease in market demand will upset that long-run equilibrium. Trace graphically and describe verbally the adjustment processes by which long-run equilibrium is restored. Now rework your analysis for increasing- and decreasing-cost industries and compare the three long-run supply curves. Why do oligopolies exist? List five or six oligopolists whose products you own or regularly purchase. What distinguishes oligopoly from monopolistic competition? The South African firm De Beers was responsible for the well-known ad line "A Diamond Is Forever." Notably, the firm's advertisements never mentioned the De Beers brand name. Why would only a near monopolist such as De Beers omit its name? (Hint: Monopoly) A firm is a monopoly in the output market and a monopsony in the input market. Its only input is the finished good, which it buys from a competitive market with an upward-sloping supply curve. The firm sells the same good to competitive buyers in the output market.