When a Perfectly Competitive Firm Sells Additional Units of Output

question 76

Multiple Choice

When a perfectly competitive firm sells additional units of output, ________, and when a monopolist sells additional units of output, ________.

• A)total revenue always rises; total revenue could rise, fall, or remain unchanged
• B)total revenue does not change; total revenue rises
• C)marginal revenue stays the same; marginal revenue rises
• D)total revenue rises; total revenue falls

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Definitions:

Decision-Making Authority

The power or right allocated to individuals or groups to make decisions within an organization.

Present Value

The modern-day estimation of future financial gains or sequences of cash influxes, using a particular rate of return for calculation.

Weighted Average

A mean calculated by giving values in a data set more influence according to some attribute of the data, often used in financial calculations like inventory costs and portfolio returns.

Free Cash Flows

Free Cash Flows represent the cash a company generates after accounting for cash outflows to support operations and maintain its capital assets.