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      Question

      Which of the following is a second-order condition of

      short-run equilibrium of firm under perfect competition?
      A MC = MR Correct Answer Incorrect Answer
      B MC = Price Correct Answer Incorrect Answer
      C Slope of MR < Slope of MC Correct Answer Incorrect Answer
      D Slope of MC < Slope of MR Correct Answer Incorrect Answer

      Solution

      Slope of MR < Slope of MC, i.e., MC must be rising for profit maximization

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