A firm is operating in a perfectly competitive industry where there are constant returns to scale. Please use separate graphs for each of the following questions.

• Find the quantity supplied by this competitive firm when market price in the short run is P2 and Pi intersects marginal cost at a point above average total cost. Establish the firm's profit or loss at this output level.
• Find the quantity supplied by this competitive firm when market price in the short run is P] and Pi intersects marginal cost at a point below average total cost but above average variable cost. Establish the firm's profit or loss at this output level. Will the firm continue to produce in the short run or will it shut down?
• What market price is expected to prevail over the long run? Why?