CFA Practice Question

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CFA Practice Question

For a firm in perfect competition, as output increases, the marginal revenue will most likely ______.
A. increase
B. decrease
C. remain constant
Explanation: When output increases for a firm in perfect competition, marginal revenue remains constant while marginal cost changes.

User Contributed Comments 2

User Comment
nickcoulby But MR = MC in perfect competition.. MC increasing = MR increasing
hon132 MR is the additional income gained aka price, P = MR in a perfect comp but since Price can't change, MR is constant
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