V x 0.05 = 10,000 V = 10,000/0.05 V = 200,000
Another way to think of this is to ask yourself how much you need to invest at %5 to get out $10,000 each year. It's the same computation, just another way to think about it.
So, the value of such a barrier to entry in monopolistic competition
(or any other industrial structure) reflects profits and interest
rates (the opportunity cost of the investment). Lower interest
rates make any given profit stream more valuable since the cost
of such a profit stream increases as interest rates fall.
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