If the supply curve for aspirin is perfectly elastic, a reduction in demand will cause the equilibrium price to:
A)rise and the equilibrium quantity to fall.
B)rise and the equilibrium quantity to stay the same.
C)fall and the equilibrium quantity to fall.
D)stay the same and the equilibrium quantity to fall.

Question

If the supply curve for aspirin is perfectly elastic, a reduction in demand will cause the equilibrium price to:
A)​rise and the equilibrium quantity to fall.
B)​rise and the equilibrium quantity to stay the same.
C)​fall and the equilibrium quantity to fall.
D)​stay the same and the equilibrium quantity to fall.

Quizplus · Accepted Answer

When the supply curve is perfectly elastic, it means that suppliers are willing to supply any quantity at a given price. Therefore, if demand falls, the equilibrium quantity will decrease, but the price will remain unchanged because the supply curve does not move.

If the Supply Curve for Aspirin Is Perfectly Elastic, a Reduction