try. Assum Both firms ka Decrease Output 0.100 75,75 4. Assume we have an island with a lagoon. The island has a circumference of 20 miles. Everybody eats at restaurants. The island has a population of 10,000, there is a transportation of dollars). cost of $1 per person per mile, and the fixed cost of establishing a restaurant is $1,000. How 11 Firm A and Fir many restaurants should there be on this island? How many restaurants should there be if the is a finite repe s an infinitely A monopolist can produce at constant average and marginal costs of AC = MC = 10. The ate markets. Assume ge in mar market demand curve given by P 100 - 30. fixed cost increased to $10,000