For a perfectly competitive firm,the market price of a good is

Question

Quizplus · Accepted Answer

In a perfectly competitive market, the individual firm is a price taker and cannot influence or change the market price. Therefore, the market price is a given which the firm cannot change (Option A is correct). As there are many firms producing an identical product, the demand curve for the individual firm is perfectly elastic, meaning that the marginal revenue is equal to the market price (Option C is correct). Therefore, the correct answer is E.

For a Perfectly Competitive Firm,the Market Price of a Good