Question

Draw a perfect competition graph include: a. Demand Curve . b. Supply Curve . c. Identify...

Draw a

perfect

competition

graph include:

a.

Demand Curve

.

b.

Supply Curve

.

c.

Identify where marginal revenue and marginal cost intersect

.

d.

Identify the profit maximizing quantity.

Business   Economics   
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Homework Answers

Answer #1

a) the AR and the MR curve that is perfeclty elastic i.e. a horizontal curve is the demand curve in the perfect industry as the firm can sell as many good as they want at the given price.

b)Supply curve is the MC curve above the Point A (where it interacts with the average variable cost curve).

c) The marginal revenue and the marginal cost curve interacts at point B,

d) the point where the marginal cost and the marginal revenue curve interacts is the profit maximizing quantity that is "B".

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