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A market is characterized by the following demand function: q = 500 P Part A [4 marks] At present, only 1 firm operates within this market. Assuming it's cost function is TO = 90q + K, where K equals capital costs, determine monopoly output and profit. Part B [2 marks] If there are no barriers to entry and it is plausible that entrants would have similar cost structures relative to the monopolist, would firms have an incentive to enter this market? Moreover, if firms in comparable markets typically compete on price, what will be the new equilibrium should entry occur? Part C [4 marks] If the monopolist is concerned that another firm with a comparable cost structure is planning on entering this market, what might it do to prevent such entry? Show this result explicitly (i.e. calculate the necessary thresholds)