Share This Article:

Economic Definition of perfect competition marginal revenue curve. Defined.

Offline Version: PDF

Term perfect competition marginal revenue curve Definition: A curve that graphically represents the relation between the marginal revenue received by a perfectly competitive firm for selling its output and the quantity of output sold. Because a perfectly competitive firm is a price taker and faces a horizontal demand curve, its marginal revenue curve is also horizontal and coincides with its average revenue (and demand) curve. A perfectly competitive firm maximizes profit by producing the quantity of output found at the intersection of the marginal revenue curve and marginal cost curve.

 

« monopoly marginal revenue curve | marginal revenue product »

Permalink: http://glossary.econguru.com/economic-term/marginal+revenue+curve,+perfect+competition

Alphabetical Reference to Over 2,000 Economic Terms