When a downward-sloping experience curve exists,a company should usually ________ the selling price of that product in order to bring in higher revenues.
A) increase
B) greatly increase
C) decrease
D) not alter
E) level

Question

Quizplus · Accepted Answer

A downward-sloping experience curve means that as production quantity increases, the cost per unit decreases. Therefore, decreasing the selling price can lead to higher demand and increased revenues. Additionally, competitors may also be able to offer lower prices due to their own experience curve, making it necessary for the company to decrease their prices in order to remain competitive.

When a Downward-Sloping Experience Curve Exists,a Company Should Usually ________