1- Explain the difference between the demand curve faced by a purely competitive firm and faced by a monopolistically competitive firm. How does this impact quantity of the firm produces and the price charged?
2. specifically, how do economists define efficiency? Identify which market structures economists believe are efficient in the long run and explain why.
3. Explain how a firm answers the following questions
a. Should the firm produce or should it shut down?
b. At what quantity should the firm produce?
c. Will the firm make an economic profit, a normal profit or a loss at that production level?
d. If the firm participates in a purely or monopolisitically competitive industry and it is making economic profit, will the industry expand or contract? Why?
4. Explain how a firm decides how many labor units to buy and what price (wage) they wil pay?