Perfectly elastic demand means whenthe percentage of change in quantity demanded is infiniteeven if the percentage of change in price is zero, the demand is said to be perfectly elastic. According to law of demand, the demand for goods and services changes when there is change in its price. ...
Perfectly Elastic Demand: Perfectly elastic demand is seen in markets with perfect competition. However, since such a market cannot exist in the real world, it is very difficult to find a product that has perfectly elastic demand. Answer and Explanation:1 ...
Perfectly inelastic demand is depicted by a vertical demand curve. This vertical demand curve is the illustration of a market... Learn more about this topic: Inelastic Demand | Definition, Graph & Examples from Chapter 3/ Lesson 13 30K
This implies that the firm faces a perfectly elastic demand curve for its product: buyers are willing to buy any number of units of output from the firm at the market price. When the perfectly competitive firm chooses what quantity to produce, then this quantity—along with the prices ...
Helpful Study Hint In order to understand what a perfectly elastic demand curve is, draw a series of demand curves that are increasingly more elastic, but not perfectly so. With each of these curves the response of quantity demanded to a given price change becomes greater and greater. The ...
Finally, demand is said to be perfectly elastic when the PED coefficient is equal to infinity. When demand is perfectly elastic, buyers will only buy at one
The firm’s profit-maximising rate of output is determined by the intersection of the demand curve with the marginal cost curve. The position of the average total cost (ATC) curve in this graph will indicate whether the firm earns a profit (price exceeds ATC) or suffers a loss (price is...
Thus, if other forceslead to a drastic change in supply, then it is deemed more elastic, but if the supply is relatively unaffected it is known as inelastic supply. This means that no matter how significantly demand or price factors change, the amount of supply will continue to be the ...
Theelasticityofsupplyisdefinedasitsabilitytochangewhenthesurroundingmarketforceschange.Thus,ifotherforcesleadtoadrasticchangeinsupply,thenitisdeemedmoreelastic,butifthesupplyisrelativelyunaffecteditisknownasinelasticsupply.Thismeansthatnomatterhowsignificantlydemandorpricefactorschange,theamountofsupplywillcontinuetobethesa...
A monopolist always sets price equal to the unitary elastic point on its demand curve.? a. True b. False, Use a graph. True or false? The aggregate demand curve slopes downward because it is the horizontal sum of the demand curves for individual goods. Is the following sta...