An individual purely competitive seller's marginal revenue curve is identical to the demand curve for its product.

Question

Quizplus · Accepted Answer

In a purely competitive market, the firm is a price taker, meaning it can sell any quantity of its product at the market price. Therefore, the marginal revenue, which is the additional revenue from selling one more unit, is equal to the market price, making the marginal revenue curve identical to the demand curve.

An Individual Purely Competitive Seller's Marginal Revenue Curve Is Identical