Suppose that a firm is collecting $100 in total revenue when it sells 10 units and $99 in total revenue when it sells 11 units.The firm is a(n)
A) pure monopolist.
B) oligopolist.
C) perfect competitor.
D) imperfect competitor.
E) monopolistic competitor.

Question

Quizplus · Accepted Answer

The fact that the firm's total revenue decreases when it increases output indicates that it has some market power and is not a perfect competitor. However, the degree of market power is not as strong as that of a pure monopolist or an oligopolist, as the decrease in revenue is relatively small. Therefore, the firm is an imperfect competitor.

Suppose That a Firm Is Collecting $100 in Total Revenue