Which of the following statements is correct?
a. The demand curve facing a competitive firm is horizontal, as is the demand curve facing a monopolist.
b. The demand curve facing a competitive firm is downward sloping, whereas the demand curve facing a monopolist is horizontal.
c. The demand curve facing a competitive firm is horizontal, whereas the demand curve facing a monopolist is downward sloping.
d. The demand curve facing a competitive firm is downward sloping, as is the demand curve facing a monopolist.
c
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According to the Taylor rule, the Federal Reserve lowers the real interest rate as the output gap ________ or the inflation rate ________.
A. decreases; increases B. increases; decreases C. decreases; decreases D. increases; increases
A firm hires labor in a perfectly competitive labor market. If the wage rate is $44, the firm should hire
a. 44 workers b. all units of labor whose marginal product is 44 c. all units of labor whose marginal revenue product is $44 d. all units of labor whose marginal revenue product is greater than or equal to $44 e. all units of labor whose marginal revenue product is less than or equal to $44
Moral hazard is the term used to describe the situation in which:
a. a consumer may buy a low-quality product. b. consumers receive a lower price because of a mistake on the part of the clerk. c. a consumer is being compensated for a defective product. d. people may change their behavior after they have signed a contract or agreed to a specified behavior. e. people want to change their behavior after they have signed a contract or agreed to a specified behavior but are unable to do so.
A portrait photographer produces packages of 100 photos. If sales increase from 600 to 700 packages, total revenue increases from $1,200 to $1,400 . The marginal revenue per photo of the 700th package is
a. $200 b. $100 c. $20 d. $2 e. $1