Q67
What is the shape of the demand curve faced by a firm under perfect competition?
A.
Horizontal
AnswerB.
Vertical
C.
Positively sloped
D.
Negatively sloped
Answer: Option A
Solution
Answer: Option A
Solution:
The shape of the demand curve faced by a firm under perfect competition is Horizontal. The demand curve faced by a firm in a perfectly competitive market is infinitely elastic. Graphically, this means that it is a horizontal line at the market price.