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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Definitions:

Catalyst

A substance that increases the rate of a chemical reaction without undergoing any permanent chemical change itself.

Molecular Level

Referring to the scale at which properties and behaviors of molecules, including interactions and reactions, can be studied and observed.

Alternate Pathway

A secondary or subsidiary route or method different from the main one, often used in biochemical reactions or processes.

Homogeneous Catalysts

Catalysts that exist in the same phase as the reactants in a chemical reaction, facilitating the reaction without being consumed.