Author Question: If the long-run supply of rice is perfectly elastic, then A) as people's incomes rise, the ... (Read 125 times)

ssal · **on:** Jun 29, 2018

If the long-run supply of rice is perfectly elastic, then

A) as people's incomes rise, the quantity of rice supplied decreases.
B) as the price of corn falls, the quantity of rice demanded decreases.
C) in the long run, a large rise in the price of rice causes no change in the quantity of rice supplied.
D) in the long run, an increase in the demand for rice leaves the price of rice unchanged.

Question 2

Which one of the following statements is TRUE for BOTH perfect competition and monopolistic competition?

A) Each type of firm faces a downward sloping demand curve.
B) Each type of firm produces a homogeneous product.
C) In the long run, firms in both industries make zero economic profit.
D) Each type of firm competes on product quality and price.