The MR = MC rule applies:A) in the short run but not in the long run.B) in the long run but not in the short run.C) in both the short run and the long run.D) only to a purely competitive firm.

Question

The MR = MC rule applies:A)  in the short run but not in the long run.B)  in the long run but not in the short run.C)  in both the short run and the long run.D)  only to a purely competitive firm.

Mayra Aburto · Accepted Answer

Final Answer : C, Explanation :  The MR = MC rule applies in both the short run and the long run. In the short run, the firm can adjust its output level but not its fixed costs. In the long run, the firm can adjust both its output level and its fixed costs. Therefore, the MR = MC rule is relevant in both time periods as it helps the firm to determine the profit-maximizing output level. This rule is not limited to only purely competitive firms as it applies to any firm that seeks to maximize profits.

The MR = MC rule applies:

A) in the short run but not in the long run.
B) in the long run but not in the short run.
C) in both the short run and the long run.
D) only to a purely competitive firm.

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