In perfect competition a firm's price is equal to its marginal revenue which is again equal to average revenue. This form maximizes its profits when its marginal cost (MC) is equal to price (p). Which of the curves in the diagram below represents the firm's marginal cost (MC)?

  • A Curve I
  • B Curve ll
  • C Curve lll
  • D Curve lV
  • E Curves l and lll

The correct answer is D. Curve lV

No explanation given
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