The marginal revenue curve coincides with the demand curve of a firm that engages in perfect price discrimination.

Question

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Under perfect price discrimination, the firm charges each customer the maximum price they are willing to pay, which means that the marginal revenue earned from selling to each customer is equal to the price charged. Therefore, the marginal revenue curve coincides with the demand curve in this case.

The Marginal Revenue Curve Coincides with the Demand Curve of a Firm