-Refer to the above figure. Which of the following statements is true about the demand curves for an individual firm in a perfectly competitive industry and a monopoly?
A) Panel A is the demand curve for a perfectly competitive firm and panel B is the demand curve for a monopoly.
B) Panel C is the demand curve for a perfectly competitive firm and panel A is the demand curve for a monopoly.
C) Panel C is the demand curve for a perfectly competitive firm and panel B is the demand curve for a monopoly.
D) Panel B is the demand curve for a perfectly competitive firm and panel A is the demand curve for a monopoly.

Question

-Refer to the above figure. Which of the following statements is true about the demand curves for an individual firm in a perfectly competitive industry and a monopoly?
A) Panel A is the demand curve for a perfectly competitive firm and panel B is the demand curve for a monopoly. 
B) Panel C is the demand curve for a perfectly competitive firm and panel A is the demand curve for a monopoly. 
C) Panel C is the demand curve for a perfectly competitive firm and panel B is the demand curve for a monopoly. 
D) Panel B is the demand curve for a perfectly competitive firm and panel A is the demand curve for a monopoly.

Quizplus · Accepted Answer

In a perfectly competitive market, the demand curve for an individual firm is perfectly elastic (horizontal line), which is typically shown in Panel C. In a monopoly, the demand curve is downward sloping, as shown in Panel B.

-Refer to the Above Figure