The demand curve facing a perfectly competitive firm
A) is the same as the industry or market demand curve.
B) depends on the firm's technology.
C) depends on the firm's costs of production.
D) is almost perfectly elastic at the market price.
E) depends on the firm's output.

Question

Quizplus · Accepted Answer

In a perfectly competitive market, individual firms are price takers, meaning they can sell any quantity at the market price. Therefore, the demand curve facing a perfectly competitive firm is perfectly elastic at the market price.

The Demand Curve Facing a Perfectly Competitive Firm