If the firm's demand curve is perfectly elastic,the firm must be a(n)
A) monopoly.
B) imperfect competitor.
C) oligopoly.
D) perfect competitor.
E) revenue maximizer.

Question

Quizplus · Accepted Answer

A demand curve that is perfectly elastic means that consumers are willing to purchase any amount of the good at a given price, and any increase in price will result in a complete loss of demand. In such a market, a single firm cannot influence the market price, and must accept the market price as given. This is characteristic of a perfectly competitive market, where many firms are selling an identical product and have no market power.

If the Firm's Demand Curve Is Perfectly Elastic,the Firm Must