For two goods, X and Y, to be classified as substitutes, it must be the case that:
A. when the price of X rises, the demand for Y increases.
B. X and Y are identical.
C. when the price of X rises, the demand for Y decreases.
D. consumers tend to purchase both items together.
Answer: A
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Refer to the below graphs. (Assume that the pre-migration labor force in Country A is 100 and that it is 150 in country B.) What part of domestic output in country A is the total wage bill before and after the immigration?
A. $500M before and $800M after
B. $500M before and $100M after
C. $400M before and $100M after
D. $400M before and $500M after
Bracket creep forces taxpayers to pay a larger percentage of their income in taxes when which of the following occurs?
(a) The emergence of high unemployment (b) Inflation (c) Deflation (d) The growth of trade deficit(s)
The Coase theorem suggests that private solutions to an externality problem
a. are effective under all conditions. b. will usually allocate resources efficiently if private parties can bargain without cost. c. are only efficient when there are negative externalities. d. may not be possible because of the distribution of property rights.
The answer is: "The price of one currency in terms of another currency." What is the question?
A) What is a foreign currency? B) What is an exchange rate? C) What is a flexible exchange rate system? D) What is a fixed exchange rate system?