The demand curve facing the monopolist in the foreign market is__________
ECONOMICS
JAMB 2019
The demand curve facing the monopolist in the foreign market is__________
- A. Elastic
- B. Inelastic
- C. Perfectly elastic
- D. Unitary
Correct Answer: C. Perfectly elastic
Explanation
The foreign market is perfectly competitive while the home market is monopolistic. Since foreign market is a perfect competitor then the monopolist is faced with average revenue or horizontal demand curve or price line.
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