If a Nondiscriminating Imperfectly Competitive Firm Is Selling Its 100th

question 366

Multiple Choice

If a nondiscriminating imperfectly competitive firm is selling its 100th unit of output for $35, its marginal revenue

• A)may be either greater or less than $35.
• B)will also be $35.
• C)will be less than $35.
• D)will be greater than $35.

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Definitions:

Fixed Expenses

Costs that do not fluctuate with changes in production level or sales volume.

Variable Expenses

Costs that vary directly with the level of production or sales volume, such as raw materials or sales commissions.

Margin of Safety

The difference between actual sales and the break-even point, indicating the extent to which sales can decline before losses begin.

Net Operating Income

The profit a company generates from its core business operations, excluding expenses and revenues from non-operating activities.