Final answer:
The demand curve faced by a perfectly competitive firm is horizontal, reflecting a perfectly elastic demand, which means the firm can sell any quantity at a constant market price. In contrast, monopolists face a downward-sloping demand curve.
Step-by-step explanation:
The demand schedule or curve confronted by the individual purely competitive firm is horizontal. This reflects the concept that a purely competitive or perfectly competitive firm perceives the demand curve that it faces to be perfectly elastic. Such firms are price takers, which means they can sell as much as they want at the market price but do not have the power to influence or change that price. The flat demand curve indicates that whether the firm sells a low quantity or a high quantity, the price (P) remains constant. In contrast, a monopolist faces a downward-sloping demand curve since it has the market power to influence the price by altering the level of output.