What type of competitive environment is characterized by a horizontal demand curve,where the retailer must sell all of its merchandise at the going "market" or equilibrium price?
A) Perfect competition
B) Oligopolistic competition
C) Pure competition
D) Pure monopoly
E) Monopolistic competition

Question

Quizplus · Accepted Answer

Pure competition is characterized by a large number of small firms producing a standardized product and having no control over the price. In this type of competitive environment, the demand curve is perfectly elastic, which means that the retailer must sell all of its merchandise at the going market or equilibrium price, otherwise, customers will buy from other firms. Overall, under pure competition, there is a level playing field for all firms, and entry and exit are easy.

What Type of Competitive Environment Is Characterized by a Horizontal