Which of the following is true of a firm that faces a downward sloping demand curve?
A)In order to sell more units,the firm needs to lower its price.
B)The total cost curve for the firm is also downward sloping.
C)The firm's total revenue and price are directly correlated.
D)The marginal revenue from each unit sold is constant.
E)The firm faces a constant marginal cost curve.

Question

Quizplus · Accepted Answer

A downward sloping demand curve means that as the price decreases, the quantity demanded by consumers increases. Therefore, in order to sell more units, the firm needs to lower its price.

Which of the Following Is True of a Firm That