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I want to ask if anyone know how the curves of Marginal Revenue and Demand "evolve" from Monopoly to Perfect competition on a graph of a firm as new competitors enter the market. I would like to know if the curves begin to shift, maybe to rotate, etc. Thanks in advance!

Initial situation: Monopoly Final situation: Perfect Cometition

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  • $\begingroup$ How the demand that firm faces changes depends on your assumptions on what’s the competitive process - are you assuming the new firms compete on price or quantity? Also there is not necessarily any gradual evolving change. Furthermore even a monopoly firm can face completely flat perfectly elastic demand function. The first picture is just simple textbook case. The green demand function there could be flat curved have small or large slope etc $\endgroup$ – 1muflon1 Aug 23 '20 at 8:26

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