Suppose That in a Competitive Market the Equilibrium Price Is

question 365

Multiple Choice

Suppose that in a competitive market the equilibrium price is $2.50. What is marginal revenue for the last unit sold by the typical firm in this market?

• A)less than $2.50
• B)more than $2.50
• C)exactly $2.50
• D)The marginal revenue cannot be determined without knowing the actual quantity sold by the typical firm.

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Definitions:

Cost of Goods Sold

Cost of goods sold represents the direct costs attributable to the production of the goods sold by a company, including materials and labor.

Finished Goods Inventory

Finished and market-ready products still awaiting purchase.

Cost of Goods Available for Sale

The total cost of a company's inventory at the beginning of the period plus the cost of any goods produced or purchased during the period.

Direct Materials Cost

The cost of raw materials that can be directly traced to the production of goods.