Question 1:

Independent trucking (i.e. large semi trucks) is an industry that can be considered perfectly competitive. Suppose that U.S. manufacturers produce less output. What impact will this have on the independent trucking industry in the short run, in terms of the market price, output of an individual firm, and market equilibrium quantity? Explain your reasoning. What impact will the increase in manufacturing output have in the long run? Explain your reasoning.

Question 2:

Compare and contrast the key attributes of perfect competition and monopoly. Give examples of both market structures that you have purchased goods from in the last few weeks (2 examples for each market structure). Explain why monopoly is less socially efficient than perfect competition. If monopoly is less socially desirable, why does the government allow monopolies to exist? Explain.