These are short essays (at least 2 paragraphs in length). Essays are graded on content and clarity. 1. Explain and illustrate the differences between accounting profit, normal profit, and economic profit. What function does profit serve within a market economy? Explain your answer. 2. Explain the concept of economies of scale. Provide an illustration to explain your answer. 3. Provide one example of a closed monopoly (created or protected by government) and one example of an open monopoly (not created or protected by government). Is a firm within a monopoly guaranteed to make a profit? Why or why not? 4. How is pure competition similar to monopolistic competition? How are they different? Provide an example of each market structure. 5. What is the Herfindahl Index? How is this Index used to examine different industries? Be specific in your answer. 6. Explain how the Organization of Petroleum Exporting Countries (OPEC) might attempt to influence the global oil industry. 7. The domestic passenger airline industry within the United States is an example of an oligopoly. What are the four largest firms in this industry? Describe the level of competition that is present within this industry and the impact that this competition has on airline prices.