1. Economists describe perfectly competitive markets as "efficient."These markets are described as being beneficial to society. Based on what you have read about pricing in different types of markets, why would economists treat efficient (perfectly competitive) markets as optimal for society?

2. Looking at an industry's ability to influence price, what do you expect for pricing as barriers to entry rise? (Describe the relationship of price to marginal cost as market power increases.)

3. For price setters, what factors drive the pricing decision?