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Suppose a small economy integrates with a large economy in Krugman's model of monopolistic competition and trade. It is the consumers in the small economy

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Suppose a small economy integrates with a large economy in Krugman's model of monopolistic competition and trade. It is the consumers in the small economy who benefits more. Explain using graphs. (5 points) Explain in what sense historical accidents can play an important role in establishing a center (or a cluster) of an industry when the industry is strongly influenced by external economy in a monopolistic competition. (5 points)

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