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It really depends. If this is a basic math question, one would assume that if the price is lower, people will buy more, ie sales will increase.
However, in real life, that is true only to a point. For example, if I offered to sell you a soda for a nickel, you probably wouldn't buy it. Most likely you'd assume that it was poor quality or that I was trying to trick you. So, lowering price doesn't necessarily mean increased sales.
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∙ 13y ago
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What is the output effect and the price effect for an oligopoly?
Since P>MC for an oligopoly, the output effect is that selling one more unit at the sales price will increase profit.The price effect is that an increase in production will increase the total amount sold, which will decrease the price and decrease the profit on all other units sold.If the output effect is greater than the price effect, the owner will increase production.If the price effect is greater than the output effect, the owner will not increase production (and may even decrease production).Oligopolists will continue to increase or decrease production until these marginal effects balance.
A decrease in demand will have what effect on equilibrium price and quantity?
There will be a decrease in price and quantity.
What terms is defined as increase or decrease in purchasing power brought on by changing in price?
income effect
What effect does a decrease in demand have on equilibrium price?
Imagine the curves. A decrease in demand would lower the equilibrium price by moving the demand curve to the left, dragging the intersection point down.
Which statement most accurately explains the effect pf competition among local gas stations on the price of gasoline?
The demand for gasoline will decrease. The price of gasoline will decrease. The supply of gasoline will increase. The price of gasoline will increase.
What is the output effect and the price effect for an oligopoly?
Since P>MC for an oligopoly, the output effect is that selling one more unit at the sales price will increase profit.The price effect is that an increase in production will increase the total amount sold, which will decrease the price and decrease the profit on all other units sold.If the output effect is greater than the price effect, the owner will increase production.If the price effect is greater than the output effect, the owner will not increase production (and may even decrease production).Oligopolists will continue to increase or decrease production until these marginal effects balance.
A decrease in demand will have what effect on equilibrium price and quantity?
There will be a decrease in price and quantity.
What is likely effect of competition among Internet service providers on the price of services?
The price of services will decrease.
When will the ps3 price come down?
The PS3 system prices will decrease dramatically once the sales of the PS4 increase some more. It has already caused the PS3 price to decrease a little bit.
Does a reduction in share price decrease company profit?
No, a reduction in a company's share price has no effect on the company's profits.
What terms is defined as increase or decrease in purchasing power brought on by changing in price?
income effect
What most accurately explains the effect of competition among local gas stations on the price of gasoline?
The price of gasoline will decrease
Most accurately explains the effect of competition among local gas stations on the price of gasoline?
The price of gasoline will decrease
Explain the subsititution and income effect of decrease in price?
substitution effect is the explanation for the downward slope of the aggregate damnd curve.
What is an example of primary effect?
An example of a primary effect is when an increase in the price of gasoline leads to a decrease in the quantity demanded by consumers.
What effect does a decrease in demand have on equilibrium price?
Imagine the curves. A decrease in demand would lower the equilibrium price by moving the demand curve to the left, dragging the intersection point down.
What happens to sales when fixed costs decrease?
When fixed costs decrease, what does this do for sales?
