When the perfectly competitive firm chooses what quantity to produce, then this quantity—along with the prices prevailing in the market for output and inputs—will determine the firm's total revenue, total costs, and ultimately, level of profits.
A perfectly competitive firm can sell as large a quantity as it wishes, as long as it accepts the prevailing market price. Total revenue is going to increase as the firm sells more, depending on the price of the product and the number of units sold.
In perfectly competitive markets, firms are price takers, which means that individually the firms have no ability to change the price of the product being sold. (True or False) Perfectly competitive markets have either many buyers or many sellers but do not have many buyers and many sellers. Nice work!
To sell 101 units, the firm must lower its price to $39.00. The marginal revenue from the 101st unit is ____. $-61.00 Marginal analysis, that is, produce the quantity of output that sets the marginal revenue (MR) equal to the marginal cost (MC), ____ for a perfectly competitive firm and ____ for a monopoly.