W.A.Mozart
New Member
- Joined
- Oct 19, 2006
- Messages
- 1
- Gender
- Undisclosed
- HSC
- 2010
In perfect competition, why does AR=Demand for the firm?
-
Finished your HSC? Check out our University Discussion, Non-School forums or help out next year's HSC students! -
YOU can help the next generation of students in the community! Share your trial papers and notes on our Notes & Resources page
microecon question (1 Viewer)
- Thread starter W.A.Mozart
- Start date
seremify007
Junior Member
Sorry I'm so not in the mood to answer this. Try asking on your uni forums or...
http://en.wikipedia.org/wiki/Perfect_competition
http://en.wikipedia.org/wiki/Perfect_competition
Zarathustra
Dasein
- Joined
- Sep 28, 2003
- Messages
- 581
- Gender
- Male
- HSC
- 2004
Isn't it because demand is perfectly elastic, so that any point on the demand curve will be the same price and so always the average revenue? That a horizontal demand curve will always equal AR - because it's just the average of the same number on that horizontal line...
Conspirocy
Member
its simple, as the big bob conlon said from unsw
since no firm has the ability to influence the market in perfect competition they cannot set the price
they are price takers - so they can supply as much or as little as they want at the market price - hence a horizontal demand curve where AR=D=P
have a nice day
since no firm has the ability to influence the market in perfect competition they cannot set the price
they are price takers - so they can supply as much or as little as they want at the market price - hence a horizontal demand curve where AR=D=P
have a nice day