3. Explain where a perfectly competitive firm's marginal revenue curve is located relative to price and demand. 4. What is the optimal output rule for profit maximization? Draw a graph to show the output level where a perfectly competitive firm maximizes profit.

3. Explain where a perfectly competitive firm's marginal revenue curve is located relative to price and demand. 4. What is the optimal output rule for profit maximization? Draw a graph to show the output level where a perfectly competitive firm maximizes profit.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter8: Perfect Competition

Section: Chapter Questions

Problem 1SCQ: Firms ill a perfectly competitive market are said to be price takers that is, once the market...

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3. Explain where a perfectly competitive firm's marginal revenue curve is located relative to price
and demand.
4. What is the optimal output rule for profit maximization? Draw a graph to show the output level
where a perfectly competitive firm maximizes profit.

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