48. Answer this question according to lecture discussion. Suppose the equation for the market demand curve is P = 200 - Q. Every firm in the market has identical cost structure with constant marginal cost (MC) and average cost (AC) MC = AC = 40 and zero fixed cost. You may use a graph to help you visualize this problem, but it will not be graded and you must show your step- by-step calculation or a zero will be assigned. (a) If this is a perfectly competitive market, calculate the industry output Qc and price Pc, consumer surplus CSc, and producer surplus PSc. Qc = _ Pc = 40 CSC = 120 PSC = (b) Suppose all the competitive firms in part (a) "gang up" to form a cartel and behave like the least powerful monopoly. Calculate the profit-maximizing output QM and price PM , profits TM , consumer surplus CSM, and deadweight loss DWLM. QM = 80 PM = 20 TUM = CSM = 210 DWLM = 203 (c) Suppose the monopoly in part (b) has not only developed a new technology to reveal the willingness to pay of all consumers, but it has also succeeded in lobbying the government to impose new legislation to block resale of its product between consumers. Calculate the profit- maximizing output Qp, profits Up, consumer surplus CSp, and deadweight loss DWLp for this most powerful monopoly. Qp = CSp = DWLp = (d) Compare all the results and provide an intuitive explanation in the relationship between market power, output, price, consumer surplus, produce surplus, profits, and deadweight loss