If the cross-elasticity of goods X and Y is positive, then the sales of X move:
A. in the opposite direction as the price of Y, and X and Y are substitute goods.
B. in the opposite direction as the price of Y, and X and Y are complementary goods.
C. in the same direction as the price of Y, and X and Y are substitute goods.
D. in the same direction as the price of Y, and X and Y are complementary goods.
Answer: C
You might also like to view...
Use the above table to answer these questions: (a) In what year did disinflation begin? (b) In what year did deflation begin?
As a plaintiff, all of the following will help you negotiate a larger settlement except which one?
A) increasing the defendant's estimate of damages B) decreasing the defendant's estimate of damages C) increasing the defendant's cost of litigation D) raising the defendant's subjective probability that you will win
Given implicit or explicit resource price agreements, if the actual price level is below the expected price level, the: a. economy will move rightward along the short-run aggregate supply curve. b. economy will move leftward along the short-run aggregate supply curve. c. short-run aggregate supply curve will shift to the left
d. long-run aggregate supply curve will become steeper. e. short-run aggregate supply curve will become flatter.
If the unemployment rate rises because the number of people not working but searching for work rises, economists would attribute this to the
A. discouraged worker effect. B. fallacy of composition. C. encouraged worker effect. D. none of the options are correct.