Problem 1. Explain the difference between the demand curve facing a monopoly firm and the demand curve facing a perfectly competitive firm.
Problem 2. Name one monopoly firm you deal with. What is the source of its monopoly power? Do you think it seeks to maximize its profits?
Problem 3. There are four basic types of firms:
(a) perfectly competitive
(b) monopoly
(c) monopolistic competitive
(d) oligopoly
Which of the above firms would most likely have zero economic profit in the long run (can be more than one type)? Explain.