9 Consider Exhibit 7.15, which shows the graph of a perfectly competitive firm in the short run. a If the firm's demand curve is MR. state whether the firm eams an economic profit or loss b Which demand curve('s) indicates the firm inours a loss? c Which demand curve(s) indicates the firm would shut down? d identify the firm's short-run supply curve. Exhibit 7.15 Perfectly competitive Prico por una [dodars) Quantity of output (units par hour]10 Consider this statement: 'The perfectly cost of such a service at your local competitive firm will sell all the quantity of mechanic is $350. What would you advise output that consumers will buy at the the owner of this business to do? Explain. prevailing market price'. Do you agree or 14 Suppose providers of lawn-mowing disagree? Explain your answer. services are in a perfectly competitive 11 Discuss why or why not firms in a industry. If these firms are currently perfectly competitive industry are likely to earning positive economic profits, how engage in advertising. will the following variables change in the 12 Discuss the following statement: 'The long run: the price of lawn-mowing easiest way for perfectly competitive firms services; the profits of existing lawn- to improve their prospects of earning mowing operators; and the level of output economic profits would be for their in the industry? Given these outcomes, owners to get together and agree to raise can you say whether the independent prices'. lawn-mowing industry is a constant-cost, 13 Suppose that the market equilibrium price increasing-cost or decreasing-cost for a routine service of a four-cylinder car industry? is $320 and the minimum average variable