The demand curve that a monopolistically competitive firm faces is _____.
A)downward-sloping but fairly elastic
B)upward-sloping but fairly inelastic
C)horizontal
D)vertical

Question

Quizplus · Accepted Answer

Monopolistically competitive firms face a downward-sloping demand curve, indicating that as the price of their product increases, the quantity demanded decreases. However, the curve is fairly elastic since there are close substitutes available in the market.

The Demand Curve That a Monopolistically Competitive Firm Faces Is