YOU ARE A PURE COMPETITOR—WHAT WAS YOUR REVENUE YESTERDAY? Suppose that you operate a purely competitive firm that buys and sells foreign currencies. Also suppose that yesterday your business activity consisted of buying 100,000 Swiss francs at the market exchange rate and selling them to U.S. travelers to Switzerland for a 3 percent commission. Go to the Federal Reserve Web site at www.federalreserve.gov and select, in order, Economic Research and Data, Statistics, and Foreign Exchange Rates. What was your total revenue in dollars yesterday (be sure to include your commission)? Why would your profit for the day be considerably less than this total revenue?

ENTRY AND EXIT OF FIRMS—WHERE HAVE THEY OCCURRED? Go to the Census Bureau Web site at www.census.gov and select Economic Census, then Comparative Statistics, and then Manufacturing (More data). Identify three manufacturing industries that experienced large percentage increases in the number of firms between 1997 and 2002. Identify three manufacturing industries that experienced large percentage decreases. What single factor is the most likely cause of the entry and exit differences between your two groups? Explain.