Under perfect competition, the demand curve facing the firm is determined by
A) the intersection of the industry demand and supply curves.
B) the tastes and preferences of consumers.
C) utility maximizing behavior on the part of consumers.
D) the willingness of the firm to supply the good.
Answer: A
You might also like to view...
The function of the interest rate in the Classical model was to keep the economy at full employment equilibrium by assuring that
A) actual saving equaled actual investment. B) actual saving equaled desired investment. C) desired saving equaled desired investment. D) desired saving equaled actual investment.
Here are three possible definitions of "Compensating Variation": I. the amount a person would be willing to pay to avoid a price increase. II. the amount of additional income needed to allow a person to restore his or her utility back to its initial level after it has been reduced by a price increase. III. the amount of income that a person who experienced a price increase would be willing to pay
to see the price return to its earlier level. Which of these definitions is (are) correct? a. Only I b. I and II c. II and III d. Only III