Question: Why are price and marginal revenue identical for the firm
Why are price and marginal revenue identical for the firm in perfect competition?
Answer to relevant QuestionsEconomists refer to perfectly competitive firms as price-takers and to monopolies as price-makers. Why? In perfect competition, imitators dampen the innovating spirit of innovators. Explain. Suppose the firm is a monopoly and its price schedule is: How many brooms would the firm produce? Would the firm be making an economic profit? Is the U.S. economy becoming more oligopolistic? What evidence supports your answer? Tit-for-tat--meaning if you raise your price, I'll match you by raising mine, and if you lower your price, I'll match you by lowering mine--seems to be a win/win strategy for both firms competing in a balanced oligopoly ...
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