Imagine that the soda market is perfectly competitive and initially in long-run equilibrium at a price of $15 a 12pk there is an increase in market demand and the price to goes up to $20. Because of this, Soda Empire increased its production from 1000 to 1400 units and is now earning $2800 in profits in the short-run. Draw a graph with this information. That includes the demand & MR curve and its Marginal Cost and Average total cost curves. Now consider what will happen in the long run. For each of the following, state if it will increase, decrease or stay the same. Market price Number of firms Firm profits A colleague asks you to be more specific about what you think will happen to long-run price. What do you need to know and how would it affect your prediction