Monopoly outcome versus competition outcome

Consider the weekly market for gyros in a popular neighborhood close to campus. Suppose this market is operating in long-run competitive equilibrium with many gyro vendors in the neighborhood, each offering basically the same gyros. Due to the structure of the market, the vendors act as price takers and each individual vendor has no market power.

The following graph displays the supply (S = MC) and demand (D) curves in the weekly market for gyros.

Place the black point (plus symbol) on the graph to indicate the market price and quantity that will result from competition.

Competitive Market 5.0 4.5 PC Outcome 4.0 S=MC 3.5 3.0 PRICE (Dollars per gyro) 2.5 2.0 1.5 1.0 0.5 D 0 0 20 40 60 80 100 120 140 160 180 200 QUANTITY (Gyros)\fPrice Quantity Market Structure (Dollars) (Gyros) Competitive Monopoly Given the summary table of the two different market structures, you can infer that, in general, the price is higher under a and the quantity is lower under a