Have you ever wondered why there are so many mattress stores? There is no question that we value a good night’s rest and are willing to spend countless dollars on finding the perfect mattress. Despite an overwhelmingly large number of mattress stores, there seems to be an increasing number of new mattress companies selling online.

Companies like Purple, Casper, Puffy, and even Amazon have started selling mattresses online. Assuming the brickand-

mortar mattress stores operated in a monopolistically competitive industry, how would you model the cost curves for these mattress companies in the short run? How have online mattress stores disrupted the industry?

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