Question

Owner of firms understand that lower prices will attract more customers. Why can firms not always reduce prices until the increase sales and profits

Answer 1

answers...

Consumers do not always like low prices.

If marginal production costs exceed marginal revenues, the firm will suffer losses, not profits.

If opportunity cost for the consumers exceeds the firm's production costs, there can be no profit.

Owners will never reduce prices even when it means increased profits.

Answer 2

@Joel_the_boss @paki