Question: Using diagrams to support your answer, explain how a company which is the only supplier of a product in an industry sets output so that

Using diagrams to support your answer, explain how a company which is the only supplier of a product in an industry sets output so that it might maximises profits. Why is the price elasticity of demand important here? Can such a firm earn supernormal / abnormal profits even in the long run? (10 marks)

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