If a Firm in a Perfectly Competitive Industry Lowers Its

question 341

Multiple Choice

If a firm in a perfectly competitive industry lowers its price below the market price, its

• A) total revenue will increase.
• B) profit will decrease.
• C) sales will drop to zero.
• D) demand curve will become downward sloping.

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Definitions:

Market Share

The share of a market held by a certain company or product.

Share Point

Share Point is a collaborative platform developed by Microsoft that allows for document management and storage, team collaboration, and information sharing across an organization.

Marginal Market Share

The additional market share a company gains over a certain period of time, indicating its growth or loss in market position.