When e=1 then MR is _________.

positive

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zero

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one

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negative

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Solution

The correct option is B zero
Marginal revenue refers to the change in revenue or additional revenue which a firm earns on selling a unit more of its output. It is the change in Revenue= Price x Quantity.
When elasticity is equal to 1 then marginal revenue is zero because the market will not react to the changes in the price of the product.

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