If a firm is a price taker, then the demand curve faced by the firm is perfectly elastic
a. True
b. False
Indicate whether the statement is true or false
True
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Use the following statements to answer this question: I. A network externality is a situation in which each individual's demand depends on the purchases of other buyers. II
Network externalities are mainly positive effects resulting from the actions of others, while ordinary externalities are mainly negative effects resulting from the actions of others. A) I and II are true. B) I is true and II is false. C) I is false and II is true. D) I and II are false.
Voters are making a choice to spend money on three projects: a dam, a school, or a road. In the choice between the dam and the school, the majority favors the school. In a choice between a dam and a road, the majority favors a dam. In a choice between a road and a school, the majority favors a road. These rankings indicate that majority voting may:
A. Result in economically efficient outcomes because of rent-seeking behavior B. Reflect irrational preferences C. Produce inconsistent choices D. Lead to consistent choices in spite of irrational community preferences