In the show "FRIENDS", Chandler Bing introduces his new laptop to his friends (Season 2, Episode 8: The One With the List, aired on 16 Nov 1995).

Chandler: All right, check out this bad boy. Twelve megabytes of RAM, 500 megabyte hard drive. Built-in spreadsheet capabilities and a modem that transmits at over 28,000 BPS.

Phoebe: Wow. What are you gonna use it for?

Chandler: Games and stuff.

A search into old computer archives reveal that the model was Compaq Contura 4/25cx. In 1995, it was priced at around $2400 for a model with even lower specs, so we can safely assume the laptop cost Chandler upward of $3000.

Now imagine a laptop one third of that price in 2020, just 25 years later. ASUS TUF Gaming Laptop is priced at $999.99 on Amazon.com. It comes with 16 Gigabytes of RAM, GeForce RTX 2060 8GB GDDR6 graphics card, 512 Gigabyte SSD, AMD Ryzen 7 3750H Processor and a Gigabit Wave 2 Wi-Fi 5.

Over last three decades, the price of computers has fallen drastically, with rapid advancements in technologies. Also, now there are more companies making computers than there were in 1995.

A.What kind of market is this (perfectly competitive/ monopolistic competition/ oligopoly/ monopoly)? Justify your answer. (25)

In the long run, the equilibrium price of laptops has fallen and the quantity of laptop produced has increased. Show the long run equilibrium in the laptop market using a clearly drawn diagram