(c) What are operating profits 7 (revenue net of total costs) for each firm? Now suppose that there is free entry, so that in equilibrium, all firms earn zero operating profits. (d) What must the number of firms N be given free entry? Now suppose that the M countries sign a trade agreement that allows each country to trade freely with all the other countries. The size of the market for firms in any one country is hence MS instead of S. (e) What must the total number of firms N be given free entry under trade? (f) How does the total number of firms N vary with the number of countries M? Explain why N varies with M in this way. (g) How do prices P and output per firm Q vary with the number of countries M? Explain why P and Q vary with M in this way. (h) How does the number of firms per country N/M vary with the number of countries M? Explain why N/M varies with M in this way