The demand schedule or curve confronted by the individual, purely competitive firm is
A)relatively elastic, that is, the elasticity coefficient is greater than unity.
B)perfectly elastic.
C)relatively inelastic, that is, the elasticity coefficient is less than unity.
D)perfectly inelastic.

Question

Quizplus · Accepted Answer

In a purely competitive market, the individual firm faces a perfectly elastic demand curve because it is a price taker. This means the firm can sell any quantity of its product at the market price, but it cannot influence the price of the product by altering the quantity it supplies.

The Demand Schedule or Curve Confronted by the Individual, Purely