A downward sloping demand curve means that
- price must be lowered to sell more
-
total revenue declines as price is lowered
- demand falls as output increases
- demand falls as output falls
The correct answer is: B
Explanation
When the price of a product decreases, consumers are generally willing to buy more of it. As a result, the quantity demanded increases. However, since each unit is sold at a lower price, the decline in price outweighs the increase in quantity, leading to a decrease in total revenue (total revenue = price x quantity). This is why a downward sloping demand curve indicates that the total revenue declines as the price is lowered.