If the market price is $40 in a perfectly competitive market, the marginal revenue from selling the fifth unit is
A)$8.
B)$20.
C)$40.
D)$200.

Question

Quizplus · Accepted Answer

In a perfectly competitive market, individual firms are price takers, meaning they cannot influence the market price. Therefore, the marginal revenue from selling the fifth unit will also be $40. This is because marginal revenue is the change in total revenue that results from producing one additional unit, and in a perfectly competitive market, selling an additional unit will not affect the market price.

If the Market Price Is $40 in a Perfectly Competitive