Since a Competitive Firm Sets MR = P to Determine

question 37

Multiple Choice

Since a competitive firm sets MR = P to determine all quantities in the short run, we can conclude that:

• A) each firm in the industry faces very large fixed costs.
• B) the demand curve faced by each individual competitive firm is perfectly elastic.
• C) the demand curve faced by each individual competitive firm is downward sloping.
• D) the industry demand curve is perfectly elastic.

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