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The Reason Firms That Face Elastic Demand Should Lower Price

Question 132

Multiple Choice

The reason firms that face elastic demand should lower price to increase total revenue is that


A) demand curves are downward-sloping.
B) consumers prefer lower prices.
C) the percentage increase in sales will be larger than the percentage decrease in price.
D) more consumers will try their products.
E) the percentage increase in sales will be smaller than the percentage decrease in price.

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