n Tecumseh, there are eight (price-taking) restaurants supplying meals, each with a long-run cost curve given by () = 4. Each restaurant has a restaurateur's operating license issued by the city of Tecumseh, of which there are only eight. While the firms behave as if the market is perfectly competitive, entry into the industry is restricted because there are only eight licenses. This means that the profit from the business can be attributed to the operating license, so we'd like to calculate the value of a license