When a Firm Faces a Downward-Sloping Demand Curve, Marginal Revenue

question 262

Multiple Choice

When a firm faces a downward-sloping demand curve, marginal revenue

• A)must exceed price because the price effect outweighs the output effect.
• B)is less than price because a firm must lower its price to sell more.
• C)equals price because the firm sells a standardized product.
• D)must exceed price because the output effect outweighs the price effect.

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