The correct answer is: A. Price and marginal revenue are equal.
A firm’s total revenue curve is the graph of the total revenue function, which is the total amount of money that a firm receives from selling its goods or services. The total revenue function is equal to the product of the price of the good or service and the quantity sold.
If a firm’s total revenue curve takes the form of a straight line which passes through the origin, then the price of the good or service is equal to the marginal revenue. This is because the marginal revenue is the additional revenue that a firm receives from selling one more unit of the good or service. If the total revenue curve is a straight line which passes through the origin, then the marginal revenue is constant and equal to the price.
The other options are incorrect because:
- Option B is incorrect because the price of the good or service may be greater than or less than the marginal revenue, depending on the shape of the total revenue curve.
- Option C is incorrect because the total cost curve is the graph of the total cost function, which is the total amount of money that a firm spends on producing its goods or services. The total cost function is always greater than or equal to the marginal cost, which is the additional cost that a firm incurs from producing one more unit of the good or service.
- Option D is incorrect because the elasticity of demand is a measure of how responsive the quantity demanded of a good or service is to changes in the price. The elasticity of demand is equal to one when the demand is unit elastic, which means that a 1% change in the price results in a 1% change in the quantity demanded.