Which of the following is TRUE of a perfectly competitive firm and a monopoly in the long run?
A) P = MC
B) P = ATC
C) MR = MC
D) P = MR
Answer: C
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Whenever productive resources are used to make capital goods
A) society is not producing efficiently. B) society is giving up current consumption. C) the production possibilities curve becomes flatter. D) absolute advantage occurs.
Consumer surplus equals the quantity supplied minus the quantity demanded
a. True b. False Indicate whether the statement is true or false
Price discrimination allows the firm to
a. segment the market and thereby capture consumer surplus b. create excess demand which will force price upward c. shift the equilibrium price to eliminate price competition among discriminating buyers d. behave like a monopolist e. select a small set from among its customers in order to charge the highest price possible
State (a) a positive economic statement of your choice, and then (b) a normative economic statement relating to your first statement.