The table given below shows the price charged by a firm and the marginal cost incurred by it for the different levels of the output. Table 10.2
The firm described in Table 10.2:

Question

The table given below shows the price charged by a firm and the marginal cost incurred by it for the different levels of the output. Table 10.2
 The firm described in Table 10.2:

Quizplus · Accepted Answer

The firm cannot be a perfectly competitive firm because in perfect competition, the firms are price takers and the price charged is equal to marginal cost. However, in this case, the price charged is higher than the marginal cost, indicating that the firm has some market power and is not a price taker. It is not necessary that the firm must be a monopoly or has no market power, but it cannot be a perfectly competitive firm.

The Table Given Below Shows the Price Charged by a Firm