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The demand curve would be perfectly elastic.

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14y ago

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How can a company have a downward demand curve but still have marginal revenue equal price?

If the Demand Curve is separate from the MR=P curve, the company can not be of Perfect Competition. It can exist in any other market structure: Monopolistic Competition, Monopoly, or Imperfect Competition. In each of these three structures, the Demand Curve will always fall twice as fast as the MP=P=AR Curve. To answer your question in these terms, the company can have a downward sloping Demand Curve separate from the MR=P curve if it is not in the PC Market Structure.


Under perfect competition is average revenue curve elastic or inelastic?

Under Perfect Competition the demand curve is perfectly elastic. I don't know if that helps but it might


Why is the marginal revenue curve the same as its demand curve?

The marginal revenue curve describes the incremental change in revenue (that is, price*units sold). The MR is not always equivalent to its demand curve. The more perfect competition is, the closer demand approaches the MR. This is because, in perfect competition, firms sell at the MC = MR = P criterion. In the opposite case, monopoly, MR always lies under of demand, and firms achieve monopoly profits by choosing a production quantity where MC = MR and charging a price mark-up.


Will its demand curve remain unchange when a firm in a monopolistic competition reaps great amounts of profits?

In monopolistic competition, a firm’s demand curve is typically downward sloping, reflecting the product differentiation that allows it to set prices above marginal cost. However, if a firm reaps significant profits, it may attract new entrants into the market, leading to increased competition. As a result, the demand curve for the firm may shift to the left over time as competitors offer similar products, ultimately reducing the firm's market power and profits. Thus, the demand curve is not static and can change in response to market dynamics.


Is a demand curve created from a demand schedule?

The data on a demand schedule can be plotted on a demand curve. Often, a demand schedule will be created before the creation of a demand curve, so as to allow for greater accuracy when plotting the demand curve.

Related Questions

How can a company have a downward demand curve but still have marginal revenue equal price?

If the Demand Curve is separate from the MR=P curve, the company can not be of Perfect Competition. It can exist in any other market structure: Monopolistic Competition, Monopoly, or Imperfect Competition. In each of these three structures, the Demand Curve will always fall twice as fast as the MP=P=AR Curve. To answer your question in these terms, the company can have a downward sloping Demand Curve separate from the MR=P curve if it is not in the PC Market Structure.


Under perfect competition is average revenue curve elastic or inelastic?

Under Perfect Competition the demand curve is perfectly elastic. I don't know if that helps but it might


Why is the marginal revenue curve the same as its demand curve?

The marginal revenue curve describes the incremental change in revenue (that is, price*units sold). The MR is not always equivalent to its demand curve. The more perfect competition is, the closer demand approaches the MR. This is because, in perfect competition, firms sell at the MC = MR = P criterion. In the opposite case, monopoly, MR always lies under of demand, and firms achieve monopoly profits by choosing a production quantity where MC = MR and charging a price mark-up.


True or False the steeper the demand curve the less elastic the demand curve?

It is false that the steeper the demand curve the less elastic the demand curve. The steeper line is used in economics to indicate the inelastic demand curve.


Is a demand curve created from a demand schedule?

The data on a demand schedule can be plotted on a demand curve. Often, a demand schedule will be created before the creation of a demand curve, so as to allow for greater accuracy when plotting the demand curve.


Will its demand curve remain unchange when a firm in a monopolistic competition reaps great amounts of profits?

In monopolistic competition, a firm’s demand curve is typically downward sloping, reflecting the product differentiation that allows it to set prices above marginal cost. However, if a firm reaps significant profits, it may attract new entrants into the market, leading to increased competition. As a result, the demand curve for the firm may shift to the left over time as competitors offer similar products, ultimately reducing the firm's market power and profits. Thus, the demand curve is not static and can change in response to market dynamics.


Difference between firms's demand curve and industry demand curve in Perfect competition?

Regard the "move-up"s of the whole industry's demand curve as a "dynamic process" at different times. When it happens to intersect with supply curve under perfect competition, we get the equilibrium price and quantity. At this time, firms seem like find their best "time" in the "dynamic process". So during this "time", the price for firms is perfect elastic because neither consumers would buy the product at a higher price nor firms would sell the product at a lower price. To sum up, the difference is -- the firm has a horizontal demand curve while the industry has a down-slope one under perfect competition.


Is an increase in demand represented by a movement up the demand curve?

An increase in demand is represented by a shift of the demand curve to the right; not a movement along the demand curve. An increase in the quantity demanded would be a movement down the demand curve.


What the primary difference between aggregate demand curve and individual demand curve?

aggregate demand curve is the total sum of all the individual demand curves while individual demand curve is the demand made by the single individual.


What is a demand curve and how it is different from demand function?

The demand curve demonstrates what happens when a product is demanded by customers. A demand function refers to an event that can affect the demand curve.


Intuitive derivation of individual demand curve using marginal utility?

how is a demand curve derived from individual demand curve ?


Market demand curve?

the market demand curve is the curve related to the demand of the commodity demanded by the group of people to the at different price.