When a Demand Curve Is Perfectly Elastic

question 28

Multiple Choice

When a demand curve is perfectly elastic:

• A)marginal revenue = average revenue = price.
• B)marginal revenue > average revenue = price.
• C)marginal revenue < average revenue = price.
• D)marginal revenue > average revenue > price.

---

Definitions:

Economies of Scale

Cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale.

Inbound Transportation Cost

Expenses incurred in bringing raw materials or products from suppliers to a company's premises.

Sourcing

The process of identifying, evaluating, and selecting suppliers for goods or services required by a business.

Inventory Aggregation

A strategy that combines different items or products into larger groups to simplify inventory management and reduce costs.