5. Draw graphs showing a perfectly competitive firm and industry in long-run equilibrium. a. How do you know that the industry is in long- run equilibrium? b. Suppose that there is

an increase in demand for this product. Show and explain the short-run adjustment process for both the firm and the industry. c. Show and explain the long-run adjustment pro- cess for both the firm and the industry. What will happen to the number of firms in the new long-run equilibrium?