If Market Demand Increases,a Perfectly Competitive Firm Will Find

question 123

Multiple Choice

If market demand increases,a perfectly competitive firm will find:

• A)its cost curves shifting up.
• B)its profit-maximizing output level increasing.
• C)the demand curve facing the firm shifting down.
• D)its marginal cost falling.
• E)its profits decreasing.

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Definitions:

Purely Competitive Seller

Refers to a market participant in an industry structure where many sellers offer identical products, and no single seller can influence price or market conditions.

Demand (D)

A consumer's desire and willingness to pay a price for a specific good or service, holding all other factors constant.

Marginal Revenue (MR)

Marginal Revenue is the additional income that is obtained from selling one more unit of a good or service.