For a firm in a competitive market,marginal revenue is always equal to average revenue.

Question

Quizplus · Accepted Answer

In a competitive market, firms are price-takers and must sell their output at the prevailing market price. Therefore, the firm's marginal revenue (the additional revenue received from selling one more unit) is equal to the market price, which is also equal to the average revenue (total revenue divided by the quantity sold). So, the statement is true.

For a Firm in a Competitive Market,marginal Revenue Is Always