(Solved): Consider the weekly market for gyros in a popular neighborhood dose to campus. Suppose this market ...

Consider the weekly market for gyros in a popular neighborhood dose to campus. Suppose this market is sperating in long-run compefitive equilibrium with many oyio vehdors in the neidhborhood, each offering basically the same gyrns. Due to the structure of the market, the vendors act as price takers and each individual vendor has no market power, The following graph dieplays the supply \( (S-M C) \) and denand (D) curves in the weekly market for orros. Phace the black point (pliss symbol) on the graoh to indicate the marhet price and quantity that will result from computition. Competitive Market neighborhood. This firm burs up all the rest of the evro food trucks in the area and begins to operate as a monopoly. Assume that this change doen not affect demand and that the maroinal cost curve of the new monopoly corresponds exactly to the supply curve from the previous dratil. The following graph reflects this new set of assumptions, and shows the demand (D), marginal revenue (MR), and marginal cost (Me) curves for the monopoly vendor. Place the black point (plers symbol) on the following graph to indicate the profit-maximaeing price and guanbty of a mincoolat. Monopoly Deadweight Loss Consider the welfare effects that result from the industry operating as a competitive market versus a moniogoly. On the monopoly graph, use the biack points (olus symbol) to shade the arec that represinis the lows of weifare, or deadiveight laes, catued by a monopoly. That is, show the ama that was formerly part of total surplus and now does not accrue to ambooly. Deadweloht loss occurs when a market is controlled by a monopoly because the resulting ecuilibrium is different from the (afficient) cornpetitive outcome. In the following table, enter the price and quantity that woald arise in a competitive market then enter the prodic-maxintiong arice and auantiby shat would be chosen if a monopolist controfied thos market: Given the summary table of the two different market structures, you can infer that. in general, thit price in iower under a and the guantitr is higher under z