There are 2 pharmaceutical companies that are researching a cure / vaccine for corona - hopefully, these companies will have a solution for the world shortly- in the meantime, some governments are proposing for alternative (close to substitute) treatments medicine. -Explain what market structure does the pharma industry operate under (Hint: it is not perfect competition or Monopoly) -IN GENERAL, how does Demand, Supply, elasticity and pricing work under such conditions? (Hint: Ch 5 and 8) 5 points -One company finally succeeds in producing the most efficient vaccine. Describe or explain in detail the following situations (25 points

-What is the new market structure this Pharma company belongs to now? Why?

-List the 5 market structure characteristics for a Monopoly and explain the relation to the Corona vaccine.

-How does Initial supply and demand look like for the new vaccine? (What about initial elasticity and price?)

-What happens in the long term for supply and demand if other pharmaceutical companies find a similar vaccine? (What about long term elasticity and price under the same conditions?)

-Describe what happens to Economic profits in the initial phase and the long term? (Hint Ch 7, green / red / yellow) Explain how the creative destruction concept applies (from alternative cure to Corona vaccine). Are there any benefits to everyone from having a Monopoly?