consider a competitive market in which firms distribute products that are imported. Assume that the cost of the imports represent 50% of both the marginal costs and average costs of the firms. Assume that the market is initially in long-run equilibrium and that the price of the products sold is $10,000. The exchange rage depreciates, increasing the costs of the imports by10%. How much will the price increase in the long-run? Will firms changes size? Will the change in the number of firms producing be related to the elasticity of demand? Show that the short- run price increases will be lower than the long-run price increase and will depend on the elasticities ( or slope) of both of the marginal cost curves of the firms.