The notrade equilibrium in a perfectly competitive market occurs
Where:
A)marginal revenue = price.
B)marginal cost = total revenue.
C)market quantity demanded = market quantity supplied.
D)average revenue = price.

Question

The no­trade equilibrium in a perfectly competitive market occurs
Where:
A)marginal revenue = price.
B)marginal cost = total revenue.
C)market quantity demanded = market quantity supplied.
D)average revenue = price.

Quizplus · Accepted Answer

The no-trade equilibrium in a perfectly competitive market occurs where market quantity demanded is equal to market quantity supplied, which is represented by the intersection of the market demand and supply curves. This is because at this point, the price is such that the quantity that producers are willing to supply equals the quantity that consumers are willing to buy, resulting in a market-clearing equilibrium where there is no excess supply or demand. Marginal revenue and marginal cost are only relevant for individual firms and not the market as a whole, while average revenue equals price in a perfectly competitive market but is not relevant for determining the no-trade equilibrium.

The No­trade Equilibrium in a Perfectly Competitive Market Occurs

The Notrade Equilibrium in a Perfectly Competitive Market Occurs