For a perfectly competitive firm, __________.

Question

MR = FC / Q

marginal revenue is equal to approximately 50% of the market price of the product

marginal revenue is equal to the firm’s fixed costs

marginal revenue is equal to the current market price of the produ

Answer 1

For a perfectly competitive firm, marginal revenue is equal to the current market price of the product.

In a perfectly competitive market, a firm is a price taker, meaning it accepts the market price as given. As a result, the additional revenue generated from selling one more unit of output (marginal revenue) is equal to the market price of the product.