If a Monopoly Lowers Its Price, Its

question 295

Multiple Choice

If a monopoly lowers its price, its

• A)total revenue must increase.
• B)total revenue must decrease.
• C)marginal revenue must increase.
• D)marginal revenue must decrease.

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Definitions:

Convenience Products

Items that consumers purchase frequently, immediately, and with minimal comparison and buying effort, such as food, newspapers, and household items.

Shopping Effort

The amount of time and energy consumers invest in the process of selecting and purchasing products or services.

Ancillary Products

Additional products or services offered to consumers in conjunction with a primary product or service.

Generic Equivalents

These are products, especially drugs, that are marketed without a brand name and are considered chemically identical to their branded counterparts, usually offered at a lower price.