If a perfectly competitive firm raises the price it charges to consumers, which of the following is the most likely outcome?
A) The firm's total revenue will increase only if the demand for its product is elastic.
B) The firm's total revenue will increase only if the demand for its product is inelastic.
C) The firm will not sell any output.
D) The firm's revenue will not change because some consumers will refuse to pay the higher price.
C
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A perfectly competitive industry has
a. A perfectly elastic demand curve b. A perfectly elastic supply curve c. A downward sloping demand curve d. A downward sloping supply curve
If this game is played once, then
a. Firm A will charge a lower price and firm B will charge a lower price b. Firm A will charge a higher price and firm B will charge a lower price c. Firm A will charge a lower price and firm B will charge a higher price d. Firm A will charge a higher price and firm B will charge a higher price