If All Conditions for a Perfectly Competitive Market Are Met

question 26

Multiple Choice

If all conditions for a perfectly competitive market are met,

• A) firms face sunk cost when entering the market.
• B) firms' demand curves are horizontal.
• C) the market demand curve is horizontal.
• D) the firms' demand curves are downward-sloping.

---

Definitions:

Monopolist

An entity, individual, or company that is the sole supplier of a particular commodity or service in a market, often resulting in the power to control prices and market conditions.

Market Demand

The aggregate amount of a product or service that every customer in a market is prepared and able to buy at different price levels.

AU Optronics

A Taiwan-based company specializing in the manufacturing of TFT LCD panels used in various electronic devices.

Price Fixing

An agreement among competitors to set the price of a product or service, rather than allowing it to be determined through free market competition.