Question: Help me solve this question, I managed to solve A but I'm stuck on B,C & D Question 2: Monopolistic Competition (16 Marks) Consider the

Help me solve this question, I managed to solve A but I'm stuck on B,C & D

Help me solve this question, I managed to solve A but I'm

Question 2: Monopolistic Competition (16 Marks) Consider the following graph, (graph 1) for the short run equilibrium for a monopolistically competitive firm producing air-conditioning units for commercial operations. Graphl S Price per unit P1 ATC P2 P3 93 D1 Quantity The following information is given: D; = $31,000 $1 7.70 TC = $550,000 + 55,0000 + $12.502 Answer the following and referring to the relevant elements of graph 1 above and show all workings. (a) Calculate price output and prot for the short run equilibrium. (4 marks) (b) Calculate price, output and prot for the long run equilibrium (with and without product differentiation). (8 marks) (c) Is the market allocatively efficient in the short run or long run (why or why not?). (2 marks) (d) Is the market productively efficient in the short run or long run (why or why not?). (2 marks)

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