Assume a downward-sloping straight-line demand curve that intersects the output axis at an output of 6.At what output does the MR curve intersect the output axis?
A)0
B)3
C)6
D)9
E)12

Question

Quizplus · Accepted Answer

The MR curve intersects the output axis at a point halfway between the origin and the quantity where demand intersects the output axis. Therefore, the halfway point between the origin (output of 0) and 6 units of output (where the demand curve intersects the output axis) is 3 units of output. Thus, the MR curve intersects the output axis at an output of 3.

Assume a Downward-Sloping Straight-Line Demand Curve That Intersects the Output