For a competitive firm, marginal revenue is ?
Correct answer: D. equal to the price of the good sold
- A. total revenue divided by the quantity sold
- B. equal to the quantity of the good sold
- C. average revenue divided by the quantity sold
- D. equal to the price of the good sold
Explanation
A competitive firm is a price taker, so selling one additional unit adds exactly the market price to total revenue. Hence marginal revenue equals the price of the good.
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