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Chapter 13Monopolistic Competition: The Competitive Model in a More Realistic Setting 1. Why is a monopolistically competitive firm not productively efficient? In what sense does a monopolistically competitive firm have excess capacity? (10 points) 2. Use the following graph for Elijah’s Burgers to answer the questions: a) If Elijah produces at the profit- maximizing level of output, how much is his total revenue? How much is his total cost? Briefly explain your calculations. (10 points) b) How much economic profit is Elijah earning? (10 points) 3. What is the difference between zero accounting profit and zero economic profit? (10 points) Is it possible for a monopolistically competitive firm to continue to earn an economic profit as new firms enter the market? (10 points)