The Demand Curve for the Product of a Perfectly Competitive

question 113

Multiple Choice

The demand curve for the product of a perfectly competitive firm's demand curve indicates that if the firm

• A) lowers its price, it can sell more.
• B) accepts the market-set price, the number of units the firm can sell is limited.
• C) raises its price, sales will fall to zero.
• D) changes its price, the quantity demanded will change in the opposite direction.

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Definitions:

Market Value

The current price at which an asset, or service can be bought or sold in a marketplace.

Interest Revenue

Income earned from lending money or depositing funds in interest-bearing accounts.

Investor Ownership

The possession of equity in a company, represented by stocks, by investors.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee, without controlling or jointly controlling the entity.