1. (20 points). Calculate, then graph, the ATC (Average Total Cost) and MC (marginal cost) curves for a typical competitive firm, labeling everything relevant. TC ATC MC 2. Why is the Average Total Cost curve U-shaped? (Hint: what are fixed costs in this problem?) 3. Why does the Marginal Cost curve slope upward? 4. Why must it be true that the MC curve intersects the ATC curve at the efficiency point? 5. In general, how much economic profit do competitive firms make in the long run? Therefore, what price would be charged by competitive firms in a long run equilibrium in this industry? 6. Why do competitive firms stay in business in the long run