Answer to Question #174929 in Microeconomics for John

Question

Explain the shape of the marginal revenue curve in each of the following

cases:

Perfect competition

Monopoly

Answer 1

The correct answer is;In a perfect competition market, the marginal revenue curve is horizontal and equal to demand, or price and production occurs where marginal cost and marginal revenue intersect while in a monopoly market, the marginal revenue curve is distinct and downward-sloping and production occurs where marginal cost and marginal revenue intersect.