A perfectly competitive firm will not operate where MC = MR but at MC = AC.

Question

Quizplus · Accepted Answer

A perfectly competitive firm will operate where MC = MR, as this is where they will be producing at the most efficient level and maximizing profits. However, in the long run, they will end up producing at the minimum point of their average cost curve (MC = AC) due to forces of competition driving prices down to the point where firms earn zero economic profit.

A Perfectly Competitive Firm Will Not Operate Where MC =