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In a perfectly competitive market, the demand curve faced by an individual firm is ________.
  • a)
    Horizontal
  • b)
    Vertical
  • c)
    Upward sloping
  • d)
    Downward sloping
Correct answer is option 'A'. Can you explain this answer?
Most Upvoted Answer
In a perfectly competitive market, the demand curve faced by an indivi...
In a perfectly competitive market, the demand curve faced by an individual firm is perfectly elastic or horizontal. This means that the firm can sell any quantity of output at the prevailing market price. Since individual firms have no market power, they have to accept the market price for their product and can sell as much as they want at that price without affecting it.
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In a perfectly competitive market, the demand curve faced by an individual firm is ________.a)Horizontalb)Verticalc)Upward slopingd)Downward slopingCorrect answer is option 'A'. Can you explain this answer?
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