Consider the following economic scenario:

A new korean restaurant opens in a city. People are initially cautious about eating new fooditems, until an influential health report warns consumers against grilled meat and suggest thatthey increase their consumption of Korean foods. As a result, demand for Korean cuisineincreases dramatically.

Assuming that the market for Korean food is perfectly competitive, answer the questions below.

a. In the story above, what should have happenedtotheshort-runeconomicprofitoftheKoreanrestaurant as a result of the health report?

b. Assuming that demand remains high, what do you anticipate will happen to the number of korean restaurants in the city over the long run?

c. Would you predict that the first korean restaurant would be able to sustainpositiveeconomicprofit over the long run? Explain your answer.

d. Using one graph ofthemarketasawholeandonegraphofarepresentativefirm'scostcurves,illustrate your answers to parts a - c.(draw diagram of a , b and c and label your diagram ).

e. Local steakhouses suffer from the popularity of Korean food and start incurring economic losses. What will happen to the number of steakhouses in town in the long run? Explain youranswer.