Manoj is a seller in a market where more can be sold only by lowering the price of the goods. Which of the following will be true about his revenue.

(A) Total revenue will increase at a constant rate.
(B) Average revenue will be more than his marginal revenue at all the levels of output sold.
(C) Marginal revenue curve will be downward sloping from left to the right.
(D) Marginal revenue can be zero at some level of output sold.

Choose the correct answer from the options given below:

(B), (C) and (D) only

The correct answer is Option (4) → (B), (C) and (D) only

The scenario where a seller can sell more only by lowering the price of the goods describes an imperfectly competitive market (like Monopoly, Monopolistic Competition, or Oligopoly), where the firm faces a downward-sloping demand curve.

• (A) Total revenue will increase at a constant rate. False. If the price must be lowered to sell more, Total Revenue (TR) will increase, but at a decreasing rate as long as Marginal Revenue (MR) is positive. TR reaches its maximum when MR is zero, and then it starts to fall when MR becomes negative.

• (B) Average revenue will be more than his marginal revenue at all the levels of output sold. True. Since the price (which is the Average Revenue or AR) must be lowered for all units to sell an additional unit, the revenue added by the last unit (MR) will always be less than the price of that unit (AR). Therefore, $\text{AR}>\text{MR}$.

• (C) Marginal revenue curve will be downward sloping from left to the right. True. Because AR is falling (as the price is lowered to sell more) and $\text{MR}<\text{AR}$, the MR curve must lie below the AR (demand) curve and must also be downward sloping. 

• (D) Marginal revenue can be zero at some level of output sold. True. As output increases and price is continuously lowered, MR will first be positive, then become zero (at the point where TR is maximum, or elasticity is unitary), and can even become negative (in the inelastic range of the demand curve).