Suppose Lagatt Green charges $2.75 per bottle. Your study partner Jabrill says that because Lagatt Green is a monopoly with market power, it should charge the higher price of $3.00 per bottle in order to increase its profit. Complete the following table to determine whether Jabrill is correct. Price Quantity Demanded Total Revenue Total Cost Profit (Dollars per bottle) (Cans) ( Dollars) (Dollars) ( Dollars) 2.75 3.00 Given the earlier information, Jabrill correct in his assertion that Lagatt Green should charge $3.00 per bottle. Suppose that a technological innovation decreases Lagatt Green's costs so that it now faces the marginal cost (MC) and average total cost (ATC) given on the following graph. Specifically, the technological innovation causes a decrease in average fixed costs, thereby lowering the ATC curve and moving the MC curve. Place the black point (plus symbol) on the following graph to indicate the profit-maximizing price and quantity for Lagatt Green. If Lagatt Green is making a profit, use the green rectangle (triangle symbols) to shade in the area representing its profit. On the other hand, if Lagatt Green is suffering a loss, use the purple rectangle (diamond symbols) to shade in the area representing the loss.Attempts |:|:|:| Keep the Highest .-' 4 2 . Monopoly outcome versus competition outcome Consider the weekly market for gyros in a popular neighborhood close to campus. Suppose this market is operating in long-run competitive equilibrium with many gyro vendors in the neighborhood, each offering basically the same gyros. Due to the structure of the market, the vendors act as price takers and each individual vendor has no market power. The following graph displays the supply {5 = MC] and demand [D] curves in the weekly market for gyros. Piece the hfack point (plus symboi) on the graph to indicate the market price and quantity that wiii result from competition. \fMonopoly 5.0 + 4.5 Monopoly Outcome 4.0 3.5 Deadweight Loss 3.0 2.5 PRICE (Dollars per gyro) 2.0 MC 1.5 1.0 0.5 D MR 0 45 90 135 180 225 270 315 380 405 450 QUANTITY (Gyros)Consider the welfare effects that result from the industry operating as a competitive market versus a monopoly. On the monopoly graph, use the black points (plus symbol) to shade the area that represents the loss of welfare, or deadweight loss, caused by a monopoly. That is, show the area that was formerly part of total surplus and now does not accrue to anybody. Deadweight loss occurs when a market is controlled by a monopoly because the resulting equilibrium is different from the (efficient) competitive outcome. In the following table, enter the price and quantity that would arise in a competitive market; then enter the profit-maximizing price and quantity that would be chosen if a monopolist controlled this market. Price Quantity Market Structure (Dollars) (Gyros) Competitive Monopoly Given the summary table of the two different market structures, you can infer that, in general, the price is lower under a and the quantity is higher under a