In equilibrium, which of the following conditions is common to both unregulated monopoly and pure competition?
A) P = MR
B) AR = ATC
C) MR = MC
D) MC = P

Question

Quizplus · Accepted Answer

Both unregulated monopoly and pure competition achieve equilibrium where marginal revenue (MR) equals marginal cost (MC). This is because at the optimal level of output, the additional revenue gained by producing one more unit of output (MR) is equal to the additional cost of producing that unit (MC). Therefore, the correct option is C, MR = MC. The other options are not necessarily common to both market structures.

In Equilibrium, Which of the Following Conditions Is Common to Both