If a Firm Faces a Perfectly Elastic Demand for Its

question 43

Multiple Choice

If a firm faces a perfectly elastic demand for its product,then

• A)it is not a price taker.
• B)it will want to lower its price to increase sales.
• C)it will want to raise its price to increase total revenue.
• D)its marginal revenue curve is horizontal at the market price.
• E)it will always make zero economic profit.

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Definitions:

Organisational Objectives

Goals and targets set by an organization to direct activities and measure success.

Standing Plans

Pre-established policies, procedures, and rules designed to guide actions and decision-making in an organization's recurring situations.

Strategic Plans

A systematic process of envisioning a desired future, and translating this vision into broadly defined goals or objectives and a sequence of steps to achieve them.

Single-use Plans

Specific plans developed to achieve a particular goal that is not expected to recur, used for unique or non-routine situations.