How do firms in an industry with perfect competition act differently from firms in an industry with monopolistic competition?(8 points)

Draw the graphs for a perfectly competitive firm and a monopolistically competitive firm that are operating in the short run.(8 points)What are the similarities and differences?(8 points)

Draw the graphs for a perfectly competitive firm and a monopolistically competitive firm that are operating in the long run.(8 points)What are the similarities and differences?(8 points)

How do firms use marginal analysis to analyze production?(5 points)

Draw a graph of the different short-run costs faced by a firm.(4 points)Describe and compare these costs.(6 points)

Draw a graph depicting economies of scale, constant returns to scale, and diseconomies of scale.(4 points)Explain the meaning of each.(6 points)

Describe market failures, and explain why market failures lead to government

intervention.(5 points)

Describe transfer payments, and explain how this form of government action is supposed to benefit society.

How does government action correct imperfect information? Why is this necessary in a free-market system?

What is the government doing when it provides a public good such as national defense?

Why does the government impose fines on firms that create pollution as a byproduct of their production?