For a perfectly competitive firm,the price of its good is equal to the firm's marginal revenue because
A) information about price changes is hard to come by for small sellers.
B) price and marginal revenue are the same economic concepts.
C) individual perfectly competitive firms cannot influence the market price by changing their output.
D) the firm's total revenue cannot be changed by anything the firms can do.
E) there are only a small number of firms in the market.

Question

Quizplus · Accepted Answer

Individual perfectly competitive firms face a market price that is determined by the overall market supply and demand. They are price takers, meaning they can sell as much as they want at the market price but cannot influence the price by altering their output level. This results in the price being equal to the marginal revenue for each unit sold.

For a Perfectly Competitive Firm,the Price of Its Good Is