The marginal revenue curve and the demand curve for a seller's product are the same when the demand curve for its product is downward sloping.

Question

Quizplus · Accepted Answer

The marginal revenue curve is not the same as the demand curve for a seller's product, even when the demand curve is downward slooping. The marginal revenue curve typically lies below the demand curve for a product in a market with downward sloping demand, because the seller must lower the price on all units sold to sell an additional unit, thus reducing the additional revenue gained from selling one more unit.

The Marginal Revenue Curve and the Demand Curve for a Seller's