Question

Which of the following statements is true? Group of answer choices A perfectly competitive firm that seeks to maximize profits will not be resource-allocative efficient. If the demand curve and the marginal revenue curve weren't the same curve for a perfectly competitive firm, then the firm would not be resource-allocative efficient. Resource allocative efficiency exists when a firm produces its output at the lowest possible per unit cost (lowest ATC). Productive efficiency exists when firms produce the quantity of output at which price equals marginal cost.

Answer 1

Answer:If the demand curve and the marginal revenue curve weren't the same curve for a perfectly competitive firm, then the firm would not be resource-allocative efficient.

Explanation: Demand curve is a graphical representation of the rate of change of demand as the price of a product changes.

Marginal revenue curve is a graphical representation of the rate of change of marginal revenueas the production and the quantity of output produced changes.

For a perfectly competitive firm with no market control, the marginal revenue curve is a horizontal line.

FOR A PERFECTLY COMPETITIVE FIRM THE MARGINAL REVENUE CURVE AND THE DEMAND CURVE SHOULD BE THE SAME IF THE FIRM ALLOCATES ITS RESOURCES EFFICIENTLY.