Deepak posted an Question
May 30, 2020 • 18:52 pm 10 points
  • UGC NET
  • Economics

The difference between value of marginal product and marginal revenue product arise only if?

the difference between value of marginal product and marginal revenue product arise only if?

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    Nidhi taparia Best Answer

    VMP = P x MPP MRP = MR x MPP There is no difference between VMP and MRP if the market is perfectly competitive. Because here, P = AR = MR. Hence VMP = MRP. But whenever the markets aren't perfectly competitive, P > MR. Hence VMP ≠ MRP in all other market forms like monopoly, monopolistic and oligopolistic markets. Among these options, option (A) is correct. In imperfectly competitive markets, AR ≠ MR.

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    yes I'm also thinking in this direction

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