When the demand curve is a downward sloping straight line, the quantity at which the marginal revenue curve intersects the horizontal (quantity) axis is ________ the quantity at which the demand curve intersects the horizontal (quantity) axis.
A) equal to
B) half
C) twice
D) four times

Question

Quizplus · Accepted Answer

When the demand curve is a downward sloping straight line, the marginal revenue curve also slopes downward but at twice the rate of the demand curve. This means that the marginal revenue curve intersects the horizontal axis at half the quantity at which the demand curve intersects the horizontal axis.

When the Demand Curve Is a Downward Sloping Straight Line