Question

For a monopolistically competitivemonopolistically competitive ​firm, A. price is equal to marginal revenueprice is equal to marginal revenue because the firm can sell as much output as it chooses at the standardizedcan sell as much output as it chooses at the standardized market price.market price. B. marginal revenue is less than the pricemarginal revenue is less than the price because the firm can sell as much output as it chooses at the standardizedcan sell as much output as it chooses at the standardized market price.market price. C. price is equal to marginal revenueprice is equal to marginal revenue because the firm must lower the price for each additional unit it wants to sell.must lower the price for each additional unit it wants to sell. nothing D. marginal revenue is less than the pricemarginal revenue is less than the price because the firm must lower the price for each additional unit it wants to sell.must lower the price for each additional unit it wants to sell.

Answer 1

The answer is D.

Step-by-step explanation:

For a monopolistically competitive, there are many firms and sellers. The products are differentiated. The products are identical.In this market, for firm to sell additional​ output, it must lower the price for each additional unit it wants to sell because the lower the price, the higher the quantity demanded.​ Total revenue increases with increasing units sold but by less than the price.