Imagine a Small Ecosystem of 100 by 100 Meters in Extent

question 23

Essay

Imagine a small ecosystem of 100 by 100 meters in extent. Invent and describe a situation in which the environmental factors of moisture, wind, topography, and fire interact.

Understand the concept of excess capacity and its implications for resource allocation in monopolistic competition.

Comprehend how product differentiation and advertising affect demand elasticity and firm's market power in monopolistic competition.

Recognize the role of economic profits in signaling entry or exit of firms in the industry.

Relate the influence of number of firms, product differentiation, and market entry barriers on the market outcomes in monopolistically competitive markets.