Multiple Choice
Since a competitive firm sets MR = P to determine all quantities in the short run, we can conclude that:
A) each firm in the industry faces very large fixed costs.
B) the demand curve faced by each individual competitive firm is perfectly elastic.
C) the demand curve faced by each individual competitive firm is downward sloping.
D) the industry demand curve is perfectly elastic.
Correct Answer:
Verified
Correct Answer:
Verified
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