When the price curve is a horizontal line, it always coincides with all of the following except
A) MR
B) TR/Q
C) AR
D) change in total revenue divided by change in output
E) TC

Question

Quizplus · Accepted Answer

When the price curve is a horizontal line, it indicates a constant price regardless of the quantity sold. This means that marginal revenue (MR), average revenue (AR), and total revenue divided by quantity (TR/Q) will all equal the constant price, as will the change in total revenue divided by change in output, since these all reflect aspects of revenue at a constant price per unit. However, total cost (TC) is not necessarily equal to or represented by the price curve, as it depends on the cost structure of the firm, which can vary independently of the price.

When the Price Curve Is a Horizontal Line, It Always