Economy, asked by nayibasassine20, 11 months ago

Why is there a price markup over marginal cost in monopolistic competition?

Answers

Answered by itzshrutiBasrani

Explanation:

Derivation of the markup rule A firm with market power will set a price and production quantity such that marginal cost equals marginal revenue. A competitive firm's marginal revenue is the price it gets for its product, and so it will equate marginal cost to price.

Answered by Anonymous

Answer:

Derivation of the markup rule A firm with market power will set aprice and production quantity such that marginal cost equals marginalrevenue. A competitive firm's marginalrevenue is the price it gets for its product, and so it will equate marginal cost to price.

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