[vikrantverma]

Q) Should they close their business shops?
ANS) no, closing thhe business is not a solution to everything. they should give a try to pass the recessionary period and wait till the market sentiments grow better again.

Q) Raise price?
ANS) i dont think raising the price would be a nice decision at this point of time. as we all know that in recession the purchasing power of the individual reduces drastically, in this scenario if we will increase the price then how the common man will be able to afford it.
u can only increase the price in recessionary time if u are enjoying monopoly in the business, or have some sort of cartel formed.

Q) Lower prices?
ANS) YES, lowering the price is the best alternative of the three sugested by the BEGINNER OF THE THREAD. as i have already mentioned the in recession due to bad market sentiments and lack of purchasing power the demand of goods reduce, and the supply remains same, and the basic funda of ECONOMICS states that then DEMAND decreases and the supply remains same, then the PRICE of the good has to come down..

BUT AGAIN, IF U DECREASE THE PRICE THEN U R CUTTING DOWN UR PROFIT MARGIN, IN MY OPINION THE BEST WAY IS TO GO FOR "COST CUTTING". THIS WAS U CAN REDUCE THE COST U R INCURRING TO PRODUCE THE GOOD, AND NOW EVEN IF U SELL IT FOR LOWER PRICES, EVEN THEN U CAN ENJOY THE SAME PROFIT MARGIN.