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No good is perfectly elastic: if it were, any raise in price would cause exactly zero units of the good to be demanded, and any drop in price would cause infinite units of the good to be demanded, which is not possible. Some goods are very elastic, however, like goods with close substitutes (Pepsi and Coke are good examples).
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What factors determine the demand for perfectly elastic goods in the market?
The demand for perfectly elastic goods in the market is determined by factors such as the availability of close substitutes, consumer preferences, and the price of the good. When there are many substitutes available, consumers are more likely to switch to a different product if the price changes, leading to a perfectly elastic demand curve.
What are the types of supply elasticity?
Types of elasticity of supply1) Perfectly elastic supply2) Relative elastic supply3) Unitary elastic supply4) Relatively in elastic supply5) Perfectly in elastic supply
What happens to the price of a good in a market with perfectly inelastic supply when there is a decrease in demand for that good?
In a market with perfectly inelastic supply, the price of a good will not change when there is a decrease in demand for that good.
When demand is perfectly elastic what happens to marginal revenue?
When Demand is perfectly elastic, Marginal Revenue is identical with price.
Demand and its types?
Perfectly inelastic demand, perfectly elastic demand, elastic demand, inelastic demand etc.
What factors determine the demand for perfectly elastic goods in the market?
The demand for perfectly elastic goods in the market is determined by factors such as the availability of close substitutes, consumer preferences, and the price of the good. When there are many substitutes available, consumers are more likely to switch to a different product if the price changes, leading to a perfectly elastic demand curve.
What are the types of supply elasticity?
Types of elasticity of supply1) Perfectly elastic supply2) Relative elastic supply3) Unitary elastic supply4) Relatively in elastic supply5) Perfectly in elastic supply
A firm operating in a purely competitive resource market faces a resource supply curve that is?
B. Perfectly elastic This is because it is operating in a perfect competitive market
Why do the firms or suppliers of a good in such markets face a perfectly elastic demand curve?
The price
What happens to the price of a good in a market with perfectly inelastic supply when there is a decrease in demand for that good?
In a market with perfectly inelastic supply, the price of a good will not change when there is a decrease in demand for that good.
When demand is perfectly elastic what happens to marginal revenue?
When Demand is perfectly elastic, Marginal Revenue is identical with price.
Demand and its types?
Perfectly inelastic demand, perfectly elastic demand, elastic demand, inelastic demand etc.
What is the mathematical definition of perfectly elastic demand?
If ep = dQ/dP.P/Q = infinity, the demand is perfectly elastic.
If the elasticity equals 0 is demand perfectly elastic or perfectly inelastic?
it is perfectly inelastic
What are 4 characteristics of of pure competition?
the industry's demand curve is perfectly elastic
What is a perfect elastic example that demonstrates the concept of perfectly elastic demand?
An example of perfectly elastic demand is when a small change in price leads to an infinite change in quantity demanded. This means consumers are willing to buy any quantity of a good at a specific price, such as a generic product like salt or water.
What type of curve does the perfectly competitive firm face?
perfectly elastic demand function.
