Respuesta :
Answer:
b. marginal revenue is $5 for the competitive firm and less than $5 for the monopolist.
Explanation:
A perfect competition is characterised by many buyers and sellers of homogenous goods and services.
Firms in a perfect competition are price takers. Price is set by forces of demand and supply.
In a perfect competition, price = marginal cost = marginal revenue =$5.
A monopoly is when there's only one firm in the industry.
A monopoly firm is fhe price setter.
In a monopoly, price is greater than marginal revenue. Therefore, the marginal revenue is less than $5.
I hope my answer helps you.
Answer: B. Marginal Revenue is $5 for the competitive firm and less than $5 for the monopolost
Explanation: Perfect competition firms are large number of buyers & sellers , homogeneous products & uniform prices , perfect information .
Monopolist refer to a single seller catering many buyers with no close substitues & restricted entry , being the price maker . Eg : Indian national railways
MR Additional revenue from additional unit sold , AR Average revenue per no. of units sold
Average Revenue curve is the demand curve .
** In case of perfect competition , AR = MR = demand curve (as this curve is horizontal parallel to x axis because of uniform price & perfectly elastic demand )
This implies that any amount of goods can be sold at prevailing uniform price .
** In case of monopolist , demand / AR curve is simply downward sloping (just as per law of demand) and the MR curve lies below it . Such because MR falls more steeply , has more slope than AR curve because of the former being affected by singular additional units & the latter being affected by all the units sold .
