Question on: JAMB Economics - 2019
The demand curve facing the monopolist in the foreign market is__________
A
Elastic
B
Inelastic
C
Perfectly elastic
D
Unitary
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Correct Option: C
The demand curve facing a monopolist in the foreign market is likely to be elastic. This is because the monopolist has to compete with other firms in the foreign market, offering similar products. This competition makes consumers more sensitive to price changes. If the monopolist raises its price, consumers can switch to other sellers, leading to a more elastic demand.
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