Please answer to these questions.

5:01 AM H ..:II tin" 6 eC0101assignme... / E 2. Consider the following economic scenario: (5*4 = 20 marks ) .0. A new korean restaurant opens in a city. People are initially cautious about eating new food items, until an inuential health report warns consumers against grilled meat and suggest that they increase their consumption of Korean foods, As a result, demand for Korean cuisine increases dramatically. Assuming that the market for Korean food is perfectly competitive, answer the questions below. a. In the story above, what should have happened to the short-run economic prot of the Korean restaurant as a result of the health report? b. Assuming that demand remains high, what do you anticipate will happen to the number of korean restaurants in the city over the long run? c. Would you predict that the rst korean restaurant would be able to sustain positive economic prot over the long run? Explain your answer. d. Using one graph of the market as a whole and one graph of a representative rm's cost curves, illustrate your answers to parts a - e. (draw diagram of a , b and c and label your diagram ). 6. Local steakhouses suffer from the popularity of Korean food and start incurring economic losses. What will happen to the number of steakhouses in town in the long run? Explain your answer. 3. Explain under each of the situation, a rm working under a perfectly competitive market would keep on producing or shut down. Show using diagram and also explain the condition thoroughly. 10 marks. a. P=14; AC=16; AVC=10 and Q=40 b. P=10; AC=10; AVC=8 and Q=20 I 4