A perfectly competitive firm's marginal revenue
A)is greater than price.
B)is less than price because a firm must lower its price to sell more.
C)is equal to price.
D)may be either greater or less than price, depending on the quantity sold.

Question

Quizplus · Accepted Answer

In a perfectly competitive market, a firm is a price taker, meaning it has no power to set prices and must accept the market price, which is also its marginal revenue. Thus, marginal revenue is equal to price in a perfectly competitive market.

A Perfectly Competitive Firm's Marginal Revenue