In a market with perfectly competitive firms, the market demand curve is usually ____ and the demand curve facing each individual firm ____
a. upward sloping; horizontal
b. downward sloping; horizontal
c. horizontal; downward sloping
d. downward sloping; downward sloping
b
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Stable money and prices are a key source of economic growth because
What will be an ideal response?
Workers in country A receive an increase in wages of 10 percent at the same time the inflation rate in country A is 8 percent. Workers in country B receive an increase in wages of 3 percent and the inflation rate in country B is 1 percent. In which country are workers better off?
A. Country A because their real wages rise by 18 percent. B. Country A because their real wages rise by 10 percent. C. Country B because the inflation rate is lower. D. Neither country because the increase in real wages is the same.
Economists first began studying the relationship between changes in aggregate expenditures and changes in GDP during
What will be an ideal response?
Government policies that encourage savings
A) reduce interest rates. B) increase interest rates. C) have no effect on interest rates. D) lower the net present value of all investments.