If one draws mc curves pre and post innovation as well as, Ask an Expert

Economics

Q. If one draws MC curves pre and post innovation as well as the Marginal Revenue line for a monopoly and the MR in a competitive situation (where MR = P), one can see that in the competitive situation, the potential profits are greater for the firm. This suggests that in a competitive market, firms are more likely to adopt innovative techniques, which is a classic argument against monopolies.

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M9156230

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