Question 1Use the demand and supply model to explain the contemporaneous changes in the number of units sold, the market price and the number of suppliers. Draw a demand and supply graph to explain your reasoning.
Question 2Do the graphs suggest that the island of cyclops, as a consumer, has market power? Explain.
Question 3Is the elasticity of supply high in this market? Explain.
Question 7Based on the graphs above, after 3 weeks, how would you describe the AI Core market now? (for example, is it a perfectly competitive market, monopoly, oligopoly or monopolistic competition?). Explain. As part of your answers you must include whether there are barriers to entry of this market.
