a) Using the following graph state the price and quantity the firm will be at if the monopolisticcompetition market is in long run equilibrium. Explain why the firm will be at that price andquantity.PriceP1MCATCBP 2P3P4P5MRDQ2Q3Quantityb) State the conditions that establish the market structure monopolistic competition, and statehow the market adjusts to long run equilibrium and what is different about long run equilibriumfor this market structure.

a). In a monopolistic market, the quantity is decided by the intersection of the MR(marginal…

a) Using the following graph state the price and quantity the firm will be at if the monopolistic competition market is in long run equilibrium. Explain why the firm will be at that price and quantity. Price P1 MC ATC P 2 P3 P4 P5 i MR Q1 Q2 Q3 Quantity b) State the conditions that establish the market structure monopolistic competition, and state how the market adjusts to long run equilibrium and what is different about long run equilibrium for this market structure.