Starting from a situation in which a firm in a competitive market produces and sells 500 doorknobs for a price of $10 per doorknob,which of the following events would decrease the firm's average revenue?

Question

Quizplus · Accepted Answer

If the market price of doorknobs falls below $10, the firm will have to lower its price to sell the same quantity of doorknobs, thus decreasing its average revenue. Option A and B would not decrease average revenue as long as the price remains the same, and option C would actually increase average revenue as the firm would be able to sell the same quantity of doorknobs for a higher price.

Starting from a Situation in Which a Firm in a Competitive