Part 1: Market Power Summary (a) What is market power? (b) What determines the ability of a rm to exercise market power? (c) What is the role of curvature and demand elasticity in determining the exer- cise of market power? (d) Explain why imperfect information, product differentiation, and economies of scale could give rise to market power. (e) What has the effect of the internet been on the market power of booksellers, record stores, and travel agents? Explain. (1') Does the exclusive supplier of a product {i.e., a brand) necessarily have market power? How is this related to identifying a supplier's competitors? (g) Explain the terms that make up the condition for a monopolist who (i) max- imizes prots by choosing price and (ii) maximizes prots over quantity sold. (h) Explain why market demand can be inelastic, even though rm demand is elastic. What does this imply about the incentive for suppliers to collude, i.e., act like a monopolist. (i) Assume two differentiated products, each produced by a single provider. How do the pricing incentives change if there is a merger between the two rms? Explain