A firm with market power in pricing faces a
A)flat demand curve.
B)supply curve parallel to the horizontal axis.
C)downward-sloping supply curve.
D)downward-sloping demand curve.

Question

Quizplus · Accepted Answer

A firm with market power is able to influence the price of its product, which means it faces a downward-sloping demand curve. This is because as the firm increases the price of its product, the quantity demanded by consumers decreases. Therefore, in order to sell more units, the firm must lower its price.

A Firm with Market Power in Pricing Faces a