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A common view in venture capital is that larger markets are more profitable, and that small markets are not worth entering, because you are unlikely

A common view in venture capital is that larger markets are more profitable, and that small markets are not worth entering, because you are unlikely to recuperate your initial investment. Imagine we had data on the observed profitability of many investments, as well as the estimated market size. Write out a causal model for market size and profitability. What is the determining function in your model?

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