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Author Question: What is the relationship between price and marginal revenue for firms in perfect competition? ... (Read 101 times)

Yi-Chen

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on: Jun 29, 2018
What is the relationship between price and marginal revenue for firms in perfect competition? Explain.
 
  What will be an ideal response?

Question 2

What role do firms play in output markets? What role do firms play in factor markets?
 
  What will be an ideal response?


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234sdffa

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Reply #1 on: Jun 29, 2018
Answer to Question 1

In perfect competition, price and marginal revenue are equal. This occurs because firms in perfectly competitive markets are price takers. Each additional unit sold results in an increase in revenue equal to the market price of the product.

Answer to Question 2

Firms are the sellers in output markets and are the buyers in factor markets.


Yi-Chen

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Reply 2 on: Jun 29, 2018
YES! Correct, THANKS for helping me on my review

31809pancho

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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