The shape of the marginal revenue product curve for a perfectly competitive firm would be ________ its marginal product curve because ________.
A)the same as; MR is constant as output increases
B)steeper than; MR decreases as output increases
C)steeper than; its product's price increases as output increases
D)flatter than; its product's price decreases as output increases
E)flatter than; it must pay a higher wage to the variable factor as output increases

Question

Quizplus · Accepted Answer

In a perfectly competitive market, the marginal revenue (MR) is constant because the firm is a price taker. Therefore, the marginal revenue product (MRP) curve is the same as the marginal product (MP) curve, as MRP is the product of MR and MP.

The Shape of the Marginal Revenue Product Curve for a Perfectly