If there is an increase in market demand in a competitive price-taker market, then in the short run
A) there will be no change in the demand curves faced by individual firms in the market.
B) the demand curves for firms will shift downward.
C) the demand curves for firms will become more elastic.
D) profits will rise.

Question

Quizplus · Accepted Answer

In a competitive price-taker market, an increase in market demand leads to higher prices, allowing firms to sell their products at higher prices, thus increasing their profits in the short run.

If There Is an Increase in Market Demand in a Competitive