If a Supplier Faces a Perfectly Horizontal Demand Curve and Sets

question 33

Multiple Choice

If a supplier faces a perfectly horizontal demand curve and sets his price slightly higher than the demand curve itself, he can expect:

• A) no change in his total revenues.
• B) everyone to begin buying his product.
• C) a complete loss of revenues.
• D) a new demand curve.

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Definitions:

Pupil

The black circular opening in the center of the eye that regulates the amount of light that enters.

Lens

A piece of glass or other transparent material with curved sides for concentrating or dispersing light rays, used in glasses or cameras to aid in focus.

Doctrine of Specific Nerve Energies

The principle that the nature of a perception is defined by the pathway over which sensory information is carried, rather than by the form of the stimulus itself.

Hering's Theory

A theory in color vision proposing that the visual system interprets color in terms of opposing pairs: blue-yellow, red-green, and black-white.