I'd like to see the graphs for questions 13 and 14 on this worksheet so that I can check my work.

13.Draw the graph of a monopolistically competitive firm in long run equilibrium.Label the profit maximizing level of output Qmc and the price the firm will charge Pmc.Next label the allocatively efficient level of output Qa and the corresponding price Pa.How is the market negatively impacted by monopolistic competition?Shade in the loss to society on the graph.

14.Draw side by side graphs of a monopolistically competitive market and a firm operating in that market earning short run losses.

a.What must be true in order for this firm to be operating while incurring a loss?

b.How will the market graph adjust in the long run due to the short run losses?

c.What will happen to demand at the representative firm?What impact will this have on the economic profit earned by the firm?

d.Using your graphs, show the process that will result in the firm earning zero economic profit.

e.How does this long run equilibrium compare to that of a perfectly competitive firm?