The demand curve for the product of a firm in a competitive market is ________,and the demand curve for the product of a monopolist is ________.
A) perfectly inelastic; downward sloping
B) horizontal; perfectly inelastic
C) downward sloping; perfectly elastic
D) downward sloping; horizontal
E) perfectly elastic; downward sloping

Question

Quizplus · Accepted Answer

In a competitive market, the demand curve for the product of a firm is perfectly elastic because the firm is a price taker and can sell any quantity at the market price. For a monopolist, the demand curve is downward sloping because the monopolist can set its price, and the quantity demanded will vary inversely with the price.

The Demand Curve for the Product of a Firm in a Competitive