Read the article and economic analysis below.

1. What are the features of the market for apps that make it competitive?

2. Doesthe information provided in the news article suggest that the market for apps is in the long-run equilibrium in 2014? Explain why or why not.

3. How would an advance in app development technology that lowered a developer's costs change the market supply and the individual developer's quantity supplied, the developer's marginal revenue, marginal cost, average total cost and economic profit? Explain your answer.

EYE on the NEWS Perfect Competition in Smartphone Apps From Zero to 75 Billion in Six Years When Apple launched its App store in July 2008, it had 10 million downloads in the first weekend. That number grew to 100 million in rst two months, 500 mil- lion in rst six months, and 1 billion in the rst nine months. By mid2014, down loads hit 75 billion and was growing at 800 apps per second. At its launch, the store had just 552 apps, but within six months, that number had grown to 15,000 and the pace of growth accelerated. Total apps passed the million mark in October 2013 and hit 1.2 million by mid-2014 and continue to grow at a pace of 25,000 to 30,000 new apps a month. As the app market grew, so did the number of app developers, which had reached 6.1 miliion by mid-2013 and 9 million by June 2014. Developers began to see the cash owing in. Although Apple takes a 30 per cent cut, it had paid developers $1 billion by June 2010, $10 billion by June 2013, and $13 billion by June 2014. Google's app store opened three months later than Apple's but it grew even more spectacularly to top 1.3 million apps in 2014. Most apps (62 per cent) are free and of those that are not free, the most common price is 99 cents, but one gaming app costs $999.99. Games represent 18 per cent of apps and education another 11 per cent. Sources of information: TechCrunch. "iTunes App Store Now Has I.2 Million Apps. Has Seen 75 Billion Downloads to Date,'I 2 June 20H: Forbes. 'l million Apps on Apple's App Store," | | December 20I3; apps- wondnet. ll July 20l3: and stascacorn. 28 August 2004. Essence of the Story 0 Apple has l.2 million Apps. a number that is growing by 25.000 to 30.000 per month. 0 75 billion apps have been downloaded. 0 Nine million people have register- ed as Apple app developers, up from 6.| million a year earlier. 0 Apple has paid $ | 3 billion to App developers. 0 App prices range from zero (for 62 per cent of apps) to $999.99 and the most common price is 9995