This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Why is it that the industry demand curve slopes downward when the demand curves faced by individual ... (Read 123 times)

Kthamas

  • Hero Member
  • *****
  • Posts: 546
on: Jun 29, 2018
Why is it that the industry demand curve slopes downward when the demand curves faced by individual firms in perfectly competitive markets are horizontal?
 
  What will be an ideal response?

Question 2

Refer to Table 2-2. Assume Billie's Bedroom Shop only produces pillows and blankets. Billie faces ________ opportunity costs in the production of pillows and blankets.
 
  A) negative B) constant C) decreasing D) increasing


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

rachel

  • Sr. Member
  • ****
  • Posts: 323
Reply #1 on: Jun 29, 2018
Answer to Question 1

Every firm in a competitive market is so small that it can increase production without affecting the price of the good. Therefore a firm in a perfectly competitive market faces a perfectly elastic demand curve. The market demand curve is downward-sloping, which reflects the law of demand: consumers will purchase higher quantities of a good at lower prices and lower quantities at higher prices.

Answer to Question 2

B


Kthamas

  • Hero Member
  • *****
  • Posts: 546
Reply #2 on: Jun 29, 2018
Thank you :)


rachel

  • Sr. Member
  • ****
  • Posts: 323
Reply #3 on: Jun 29, 2018
Happy to help you


« previous next »
 

Did you know?

Prostaglandins were first isolated from human semen in Sweden in the 1930s. They were so named because the researcher thought that they came from the prostate gland. In fact, prostaglandins exist and are synthesized in almost every cell of the body.

Did you know?

The ratio of hydrogen atoms to oxygen in water (H2O) is 2:1.

Did you know?

Blastomycosis is often misdiagnosed, resulting in tragic outcomes. It is caused by a fungus living in moist soil, in wooded areas of the United States and Canada. If inhaled, the fungus can cause mild breathing problems that may worsen and cause serious illness and even death.

Did you know?

Before a vaccine is licensed in the USA, the Food and Drug Administration (FDA) reviews it for safety and effectiveness. The CDC then reviews all studies again, as well as the American Academy of Pediatrics and the American Academy of Family Physicians. Every lot of vaccine is tested before administration to the public, and the FDA regularly inspects vaccine manufacturers' facilities.

Did you know?

On average, the stomach produces 2 L of hydrochloric acid per day.

A theoretical photosynthetic response curve. A theoretical photosynthetic response curve.
Nanomaterials Applications and Industry Used Nanomaterials Applications and Industry Used
Downward movement of the piston lowers the air pressure inside the combustion chamber. The pressure ... Downward movement of the piston lowers the air pressure inside the combustion chamber. The pressure ...
Human photopic (cone) and scotopic (rod) spectral sensitivity curves. The peak of each curve has ... Human photopic (cone) and scotopic (rod) spectral sensitivity curves. The peak of each curve has ...
Dose-response curve with threshold Dose-response curve with threshold
The Frequency Distribution Curve of a Drug The Frequency Distribution Curve of a Drug
Video: Egg and Sperm Formations in Animals Animation

For a complete list of videos, visit our video library