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In a hypothetical scenario, country A's economic is experiencing an economic recession. The Reserve Bank of country A made twelve interest rate increases throughout the
In a hypothetical scenario, country A's economic is experiencing an economic recession. The Reserve Bank of country A made twelve interest rate increases throughout the following months. Such decisions lead to the increase in the cost of living such as the price of everyday necessities like bread and milk. Assuming a hypothetical rm, rm B, is a monopoly. Use cost curve in micmeconomics. Assume monopolistic competition. Include cost competition as well. Draw a diagram to illustrate the rm 3 making economic prots before the interest rate increases. On your diagram clearly indicate the quantity the rm is choosing to produce, and the price rm is choosing to charge. Assuming costs of goods remain constant for rm B, in reference to the previous question and diagram, demonstrate the new changes due to an interest rate hike. Using a new diagram, illustrate the rm's economic situation. Is there an economic prot or loss, considering the changes. Show the rm what they are willing to produce, at what production point, and sell, at what price point
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