Question: How will the imposition on firms of a fixed charge per annum for the privilege of operating affect:
(a) the price and output set by a monopolist;
(b) the price and output of a competitive industry where all firms are equally efficient;
(c) the price and output of a typical firm in that industry;
(d) the price and output of an intra-marginal firm in a competitive industry in which some firms are more efficient than others?
In each case analyse short- and long-run responses.