Bleyer Industries Inc., the only U.S. manufacturer of plastic Easter eggs, once manufactured 250 million eggs each year. However, imports from China cut into its business. In 2005, Bleyer filed for bankruptcy because the Chinese firms could produce the eggs at much lower costs (“U.S. Plastic Egg Industry a Shell of Its Former Self,” San Francisco Chronicle, January 14, 2005). Use graphs to show how a competitive import industry could drive a monopoly out of business.

1. Conditions for Price Discrimination