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Discuss Why Saving and Investing Entails Risk

question 31

Essay

Discuss why saving and investing entails risk.What is the reward for bearing risk? Explain how income taxes affect the returns to risk bearing and its impact on overall risk taking and innovation.

Understand the market dynamics of monopolistic competition in both short and long runs.
Analyze the impact of entering and exiting firms on industry profits and economic profits.
Calculate firm profits, losses, and the break-even point in a monopolistically competitive market.
Determine profit-maximizing output levels and prices for firms in monopolistic competition.

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