Final answer:
Teddy's creation of an imaginary world showcases his vivid imagination and desire for escapism, adding to his characterization. The impact of his creation on the reader creates a bittersweet feeling as they witness the contrast between his imagination and reality.
Step-by-step explanation:
Teddy's creation of a complex and sophisticated imaginary world in the story tells the reader about his vivid imagination and creativity. It shows that Teddy has a rich inner world and a desire to escape from the realities of his life. This adds to his characterization by portraying him as an imaginative and introspective character.
The impact of Teddy's creation on the reader is that it provides insight into his mindset and allows the reader to empathize with his need for escapism. The conclusion of the story may leave the reader with a bittersweet feeling, as they witness the contrast between Teddy's vibrant imaginary world and the realities he faces.