Question: The figures below illustrate the difference between the demand curve for a competitive industry and the demand curve facing an individual firm in that industry.

The figures below illustrate the difference between the demand curve for a competitive industry and the demand curve facing an individual firm in that industry. Review these figures and answer the following questions. LO O O + + Price (dollars) Price (dollars) - 0 - LO 100 200 300 400 Quantity (millions) Quantity (thousands) a. If the individual firm tried to charge a higher price for its product, O A. it would lose its customers. O B. other firms would also charge a higher price. O C. other firms would charge a lower price. O D. the market price would rise

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2. Find out if there are other reference points that can be used as reasonable alternatives.

1. Identify your reference point when making a decision based on an element of risk.

3. If there are reasonable alternatives, think about your decisions based on the different reference points and see if there are any contradictions in the decisions.