Can someone explain question 2 to me in detail, if possible provide me with a graph to ease understanding. All I understand from this question is that maximizing of profit occrus at MR=MC. I can't visualize how the firm is producing at a level of output where its marginal cost is increasing and is above the market price.

For question 3 here's my understanding on this short term supernormal thats why new firms are interested,after long term many firms will not be able to make a profit due to oversupply therefore some inefficient firms will exit the market. while the current firms have fufil their economic costs and have no desirable to exit the firm because they already fufil their normal profit (the benefits they can get if they work in other firms). Therefore i choose the answer A for this. Is this right

2 A perfectly competitive firm is currently producing at a level of output where its marginal cost is increasing and is above the market price. What would be the effect on price and output if the firm were to maximise its profit? effect on output effect on price A decrease increase B decrease constant C increase decrease D increase constant 3 Which of the following would apply under conditions of perfect competition in long-run equilibrium? productive allocatio level of a firm's efficiency efficiency profit A yes yes normal B yes yes supernormal C yes no supernormal no yes normal