Label the graph. ### Graph Analysis: Price and Cost per Ride**Description:**The graph illustrates the relationship between price and cost in dollars per ride (vertical axis) and the quantity of rides per hour (horizontal axis).**Key Elements:**1. **Demand Curve (D):** - Represented by the blue line. - Downward sloping from left to right, indicating that as the price decreases, the quantity demanded increases. - Begins at a price of $25 (0 rides per hour) and crosses the quantity axis at 5 rides per hour with a price of $0.2. **Marginal Cost Curve (MC):** - Represented by the red line. - Upward sloping from left to right, suggesting that as the quantity of rides increases, the marginal cost also increases. - Starts near a price of $5 and rises to intersect the demand curve at a price of $20 and approximately 4 rides per hour.**Intersection Point:**- The two curves intersect around a price of $20 and a quantity of around 4 rides per hour. This point indicates the equilibrium where the market can settle, balancing supply and demand.### Explanation:The graph is a classic representation used in economics to show the interaction between demand and cost. It helps in understanding how prices are determined in a competitive market. The intersection of the demand and marginal cost curves indicates the market equilibrium, where the quantity supplied matches the quantity demanded at a given price. **Sandy Cove Resort: Monopoly Market Analysis**Sandy Cove Resort is a single-price monopoly, offering jet ski rides as the only beach activity. The graph below illustrates the marginal cost of a jet ski ride and the demand for these rides.**Instructions:**1. **Marginal Revenue Curve**: On the graph, draw the resort's marginal revenue curve, labeled as MR.2. **Consumer Surplus Redistribution**: Draw a shape to represent the consumer surplus that is redistributed from consumers to the resort due to the market being a single-price monopoly rather than perfectly competitive. Label this area as 1.3. **Deadweight Loss**: Draw a shape to indicate the deadweight loss created by the monopoly. Label this area as 2.**Note**: Only create the objects specified in these instructions.---**Graph Explanation:**- **Axes**: The graph's horizontal axis represents quantity (number of jet ski rides), while the vertical axis depicts price and cost (in dollars per ride).- **Curves**: - A downward-sloping blue line represents the demand curve. - An upward-sloping red line signifies the marginal cost curve, labeled MC.This analysis helps in understanding the economic effects of a monopoly in comparison to a perfectly competitive market.

A single price-monopoly firm sells all of its product at the same price to all its consumers. It cannot discriminate its price among the buyers. It always follows a unique price for all its consumers.Here Sandy cove resort is a single-price monopolist. The marginal revenue curve always has a twice slope of its demand curve. In the given picture, the demand curve intersects at the quantity of 5. Hence, MR should intersect at the quantity of 2.5. If the market is perfectly competitive, production will occur when the price equals the marginal cost. That is, P=MC At this level, 2.5 rides per hour will service. Similarly, production occurs when marginal cost equals marginal revenue if the market is a single-price monopoly. That is, MR=MC At this level, 1.5 rides per hour will service. The consumer surplus is given as point 1.The deadweight loss related to the monopoly is given below. The deadweight loss occur because of under production due to the monopoly. That is,

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Economics

Sandy Cove Resort is a single-price monopoly and the only beach activity it offers is jet ski rides. The graph shows the marginal cost of a jet ski ride and the demand for jet ski rides. On the graph draw the resort's marginal revenue curve. Label it MR. Draw a shape to show the consumer surplus that is redistributed from consumers to the resort as a result of the market being a single-price monopoly rather than perfectly competitive. Label it 1. Draw a shape to show the deadweight loss created. Label it 2.