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Let's say a city requires taxicabs, in a monopolistically competitive market, to have a medallion (license) to operate, which it gives out freely. Suppose initially

Let's say a city requires taxicabs, in a monopolistically competitive market, to have a medallion (license) to operate, which it gives out freely. Suppose initially there was an profit (economic) to operating a taxi in this city. Explain what would happen over time to the number of taxi's, and profits in this industry, both verbally AND graphically

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