If the long-run market supply curve is perfectly elastic, a fall in demand will cause the final equilibrium to be at:
A) the same price but a lower output.
B) a lower price and a lower output.
C) a lower price but the same output.
D) the same price and the same output.

Question

Quizplus · Accepted Answer

In a perfectly elastic long-run supply curve, the price remains constant regardless of changes in demand. Therefore, a fall in demand will result in a lower output at the same price.

If the Long-Run Market Supply Curve Is Perfectly Elastic, a Fall