The optimal markup factor is 1.7.
A monopoly is when there is only one firm operating in an industry. A monopolist sets the price for their goods.
A monopolistic competitor is when there are many firms operating in the industry. The firms sell differentiated products. They set the price for their goods.
The markup factor = [tex]\frac{1}{1 - \frac{1}{e} }[/tex]
[tex]\frac{1}{1 - \frac{1}{2.4} }[/tex] = 1.7
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