It would be referred to as Perfectly Elastic. This suggest that Price and Quantity are less involved if at all. More exactly, goods are only bought and sold at one price; this would occur in a situation with identical products being offered in a market. For example, think of gasoline. Picture two gas stations at an intersection. If one gas station were to raise prices by five or ten cents, most or all of the customers would buy gas from the cheaper station.
yes the demand curve is perfectly inelastic and horizontal
No it does not. Only Perfectly Competitive firms have a horizontal Marginal Cost curve, which is also there demand curve.
A perfectly inelastic demand curve will be completely horizontal and means that consumers would any price for a particular good, which is almost impossible. The closer to being horizontal a demand curve is, the more inelastic the demand.
Price elasticity is a specific type of slope of the demand curve. A perfectly inelastic demand means that the quantity will not change with the price. This line is perfectly vertical. A perfectly elastic demand curve is horizontal and means that at any given quantity, there is only one price. Also, a slope gets steeper, demand becomes more inelastic.
If a market is faced with a horizontal demand curve, then the demand in that market by consumers is perfectly elastic. More simply, any minuscule change in price causes a huge change in quantity demanded.
yes the demand curve is perfectly inelastic and horizontal
No it does not. Only Perfectly Competitive firms have a horizontal Marginal Cost curve, which is also there demand curve.
A perfectly inelastic demand curve will be completely horizontal and means that consumers would any price for a particular good, which is almost impossible. The closer to being horizontal a demand curve is, the more inelastic the demand.
Price elasticity is a specific type of slope of the demand curve. A perfectly inelastic demand means that the quantity will not change with the price. This line is perfectly vertical. A perfectly elastic demand curve is horizontal and means that at any given quantity, there is only one price. Also, a slope gets steeper, demand becomes more inelastic.
If a market is faced with a horizontal demand curve, then the demand in that market by consumers is perfectly elastic. More simply, any minuscule change in price causes a huge change in quantity demanded.
A diagram of a perfectly competitive market typically shows a horizontal demand curve representing perfect competition, a horizontal supply curve at the market price, and a point where supply equals demand to show equilibrium. It also includes the producer and consumer surplus to illustrate market efficiency.
the demand curve for a good is very unlikely to be perfectly vertical because
Horizontal
When supply and demand are perfectly elastic/inelastic
The world supply curve is considered perfectly elastic.
The demand curve would be perfectly elastic.
A perfectly elastic demand curve means that the quantity demanded changes infinitely with a change in price, while a perfectly inelastic demand curve means that the quantity demanded remains constant regardless of price changes.