When firms charge different prices for differentiated products in imperfect competition, each firm faces a demand curve that is ___________ than would be the case if the market was perfectly competitive.
A) flatter
B) farther to the left
C) farther to the right
D) less elastic

Question

Quizplus · Accepted Answer

When firms charge different prices for differentiated products in imperfect competition, they have some market power and can face a downward sloping demand curve. This demand curve is less elastic than it would be in a perfectly competitive market, as consumers may not have many close substitutes and are willing to pay a higher price for the product. Therefore, the correct answer is D - less elastic.

When Firms Charge Different Prices for Differentiated Products in Imperfect