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a) Compare the firms based on - (a1) the commodity or item that's sold and the extent of production differentiation, (a2) the ease or difficulty of entering and exiting the market, (a3) the distribution of market share for the largest firms, (a4) the number of buyers and how they work with or against the sellers to dictate price and quantity, and (a5) the relationship between sellers.
b) How will the marginal and average cost curves of the selected three firms shift or change as a result of the following events: (d1) an increase in wages of all labor; (d2) an increase in the rental payments on office machinery; (d3) a technological advance; (d4) an increase in sales taxes; and (d5) a decline in the price of a basic raw material?
In order to determine which system should be selected, calculate the incremental profitability index (see example 16.4). Enter the incremental
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