Restaurants have always played an essential role in the business, social, intellectual and artistic life of a thriving society. The major events of life, personal and professional, are celebrated in r

Restaurants have always played an essential role in the business, social, intellectual and artistic life of a thriving society. The major events of life, personal and professional, are celebrated in restaurants. Acquaintances become friends around a table in the safe and controlled environment of a restaurant. Assuming we all went out for dinner at Jack Astor's Bar and Grill and we were provided pens, markers and paper by our waitress while we wait on our dinner (about 30 minutes). I had a few questions. What would your response be? 

Part A (25 Marks):

"Ontario restaurant price hikes boost food inflation after minimum wage increase"

Using demand and supply analysis and a restaurant of your choice discuss the above statement.

Part B (25 Marks):

"The Elasticity of demand for restaurant meals is said to be approximately 2.3".

Explain in your own words what elasticity of demand is and why demand for restaurant meals will be so elastic.

Part C (25 Marks):

"The restaurant industry has a market structure that comes closest to monopolistic competition". 

Explain the main characteristics of a monopolistically competitive industry, describing both its similarities and differences from the models of perfect competition and monopoly.

Part D (25 Marks):

"The restaurant industry is highly competitive with respect to price, value and promotions, service, location, and food quality".

Explain and illustrate both short-run equilibrium and long-run equilibrium for a monopolistically competitive firm.