For a price-taking firm, the AR and MR curves are A horizontal line at ₹10 labelled AR = MR: the firm can sell any quantity at ₹10.

For a price-taking firm, the AR and MR…

For a price-taking firm, the AR and MR curves are

Question 23

EasyOriginal question

For a price-taking firm, the AR and MR curves are

A horizontal line at ₹10 labelled AR = MR: the firm can sell any quantity at ₹10.

downward-sloping lines, MR below ARCorrect answerYour answerupward-sloping linesCorrect answerYour answervertical linesCorrect answerYour answerthe same horizontal line at the market priceCorrect answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer D

Correct answer: D

The firm can sell any quantity at the market price, so every unit earns that price: AR = MR = P.

Concept: AR and MR of a price taker
Typical timeTypical: 40 s
Your timeYours: —

The rule this testsRevenue at a price set by the market

Practise this chapter →

Ten questions from Revenue & Producer's Equilibrium, at your own pace.

Practise this chapter →

Ten questions from Revenue & Producer's Equilibrium, at your own pace.

For a price-taking firm, the AR and MR curves are

Question 23

Explanation