If a Firm Faces a Horizontal Demand Curve,marginal Revenue

question 91

Multiple Choice

If a firm faces a horizontal demand curve,marginal revenue

• A)is constant regardless of how much output the firm produces
• B)decreases as the firm produces more output
• C)increases as the firm produces more output
• D)decreases if the firm produces less output
• E)is less than price at most possible output levels

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Definitions:

Working Capital

The difference between a company's current assets and current liabilities, indicating the short-term liquidity and operational efficiency.

Current Liabilities

Liabilities expected to be settled within one year or within the normal operating cycle of the business, such as accounts payable and short-term loans.

Current Ratio

A measure used to determine a company's potential to fulfill obligations due within one year by calculating the ratio of its current assets to its current liabilities.

Indicator Of Liquidity

Measures that indicate how easily a company can convert its assets into cash to cover short-term obligations.