A Perfectly Competitive Firm Has a Random Demand with a 20

question 126

Multiple Choice

A perfectly competitive firm has a random demand with a 20 percent chance of being $10, a 20 percent chance of $16, and a 60 percent chance of being $20. What is the firm's expected marginal revenue?

• A)$16.00
• B)$15.20
• C)$17.20
• D)$16.40

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Definitions:

Gibbs Free Energy

A thermodynamic quantity representing the amount of usable energy in a system to perform work at constant temperature and pressure.

Equilibrium Constant

A numerical value that represents the ratio of concentrations of products to reactants at equilibrium in a chemical reaction.

Arrhenius Equation

An equation describing the rate of a chemical reaction as a function of temperature, providing a quantitative basis for the effect of temperature on reaction rates.

Ea

Activation energy, the minimum amount of energy required to initiate a chemical reaction.