Table 14-11
Suppose that a firm in a competitive market faces the following prices and costs:
-Refer to Table 14-11. The marginal revenue from producing the 3rd unit equals (i) $6.
(ii) the price.(iii) the marginal cost.
A)(i) only
B)(i) and (ii) only
C)(iii) only
D)(i), (ii), and (iii)

Question

Table 14-11
Suppose that a firm in a competitive market faces the following prices and costs: 
-Refer to Table 14-11. The marginal revenue from producing the 3rd unit equals (i) $6.
(ii) the price.(iii) the marginal cost.
A)(i) only 
B)(i) and (ii) only 
C)(iii) only 
D)(i), (ii), and (iii)

Quizplus · Accepted Answer

In a perfectly competitive market, the marginal revenue is equal to the price, so the marginal revenue from producing the 3rd unit is $6, which is equal to the price. However, it is not equal to the marginal cost, which is $3. Therefore, the best choice is (i) and (ii) only.

Table 14-11 Suppose That a Firm in a Competitive Market Faces the Faces