A perfectly competitive firm maximizes its profit by setting its price so that it exceeds the marginal revenue

Economics Dec 17, 2020

A perfectly competitive firm maximizes its profit by setting its price so that it exceeds the marginal revenue. manipulating demand. choosing to produce the quantity that sets MC equal to MR. cutting wages.

Expert Solution

Option (3) is right answer.In perfect competition firm maximises its profit by setting MR = MC. At this level, profit of firm will br maximised abd corresponding quantity will be produced.

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