Answer to Question #296888 in Microeconomics for Honey Grace

Question

Given the demand equation Q=250-50P . Determine the total revenue and marginal revenue functions. Does this situation occur in a perfectly competitive market? If yes why? If not why not?

Answer 1

$Q=250-50P$

$T.R=Q×P$

$=(250×50P)P$

$=250P-50P^{2}$

$MR=\frac{∆TR}{P}=250-100P$

Yes this is a perfectly competitive market. This is because the marginal revenue equation is an equation for a straight line.