1. The demand curve for the perfect competitor is horizontal because
A: demand is perfectly inelastic
B: the market dictates each firm's price
C: the firm is price maker
d: None of the above
2. For each example below, identify which statement is not characteristic of a perfectly competitive industry.
a: one firm produce a large portion of the industry's total output
b: there are many firms in the industry
c: their products are indistinguishable
d: firms can easily exit and enter the industry