For a perfectly competitive firm ?
Correct answer: A. Price equals marginal revenue
- A. Price equals marginal revenue
- B. price is greater than marginal revenue
- C. price equals total revenue
- D. price equals total cost
Explanation
A perfectly competitive firm can sell any feasible quantity at the prevailing market price, so its marginal revenue from another unit equals that price. Thus price equals marginal revenue.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
About Microeconomics
Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
Practise Microeconomics
1,742 free Microeconomics MCQs from Economics, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Economics questions like this
Economics is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Microeconomics questions
Which of the following market would most closely satisfy the requirements for a competitive market ?
For a competitive firm, marginal revenue is ?
If a competitive firm is producing a level of output where marginal revenue exceeds marginal cost the firm could increase profit if it ?
In the short run firms in perfect competition will still produce provided ?
A profit maximizing firm is perfect competition produces where ?
Firms in perfect competition face a?