Practicing Success
Practicing Success
CUET Preparation Today
| The demand curve of a firm is horizontal and parallel to the x axis. What does this NOT imply? |
Firm is operating in perfect competition Firm is a price taker More quantity can be sold at higher prices Elasticity of demand is perfectly elastic |
| More quantity can be sold at higher prices |
| Horizontal demand curve means that demand is perfectly elastic, firm is operating in perfect competition and that firm is given the prices i.e. it is a price taker. Horizontal demand curve means any quantity of commodity can be sold at the given prices, it DOES NOT mean more quantity at higher prices. |
