Ly Lab 11 (Question 1) ~ Lyryx Learning Inc - Google Chrome laecon1.lyryx.com/student-servlets/LabServlet?ccid=3692 Lab 11 (Question 1) Name: Hang Ma Date: 2020-08-02 Question 1 [20 points] The graph below shows the demand faced by Second Time Around Clothing, a monopolist, which incurs only fixed costs and therefore has a marginal cost equal to zero. Note: If necessary round your answers to two decimal places. a) Suppose that a new firm, which also has zero marginal costs, enters this industry and assumes that Second Time Around Clothing will continue to produce its current output. Plot the existing firm's marginal revenue line, new firm's marginal revenue line, and new firm's demand line. Marginal Revenue # 367 32 287 Demand Cost ($) 24 16 32 40 48 56 64 Reset Units of Output b) Before the new firm disrupted Second Time Around Clothing's monopoly what was the price Second Time Around Clothing charged, and what quantity of output did it produce? Price = $ 0 Output = 0 c) What output will the new firm choose to produce, and what will be the new market price, given both firms' output? New Market Price = $ 0 New Firm's Output = 0 6 9:57 AM 2020-08-02