Question 12 - 10 marks Salon Organica is a hair salon in a small Australian town. The salon differentiates itself from its many competitors by using only organic hair care products, and attracting the health and environmental conscious customers. The Table 1 below contains some of the revenue and cost information (approximate) for this business. a. Output (Q) Price (P) Table 1 Marginal Revenue (MR) Marginal Cost (MC) Average Cost (AC) 5 20 20 4 28 10 19 18 6 17 15 17 13 8 14 20 15.5 11 11 13 25 14 8 17 14 30 12 2 26 16 This firm most likely is operating in which market structure? ING b. Explain your answer above. You must use i. the information from the table, and ii. the characteristics of the selected market structures in your explanation. (1 mark) (3 marks) C. i. Assuming that Salon Organica is currently operating at its profit maximising output level What is the current price and output of the firm? ii. Give reasons. (2 marks) d. Hair salon will not be able to maintain this profit in the long run. Explain using relevant economic concepts (4 marks)