If an increase in the price of good X results in a decrease in the quantity of Y demanded,

A. good X and good Y are substitutes.
B. good X and good Y are complements.
C. the cross-price elasticity of demand for good Y is positive.
D. There is not sufficient information to determine the relationship between good X and good Y.


Answer: B

Economics

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Assume that currently one U.S. dollar will purchase £0.65. Investors believe that one year from now a U.S. dollar will purchase £0.72. If we consider the U.S. dollar-pound market, where the horizontal axis measure the quantity of pounds, explain what we are likely to see in terms of demand and supply and the exchange rate.

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Firms 1 and 2 compete in a Cournot duopoly. If firm 2 adopts a strategy that raises firm 1's marginal cost:

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A characteristic of a public good is that a public good is provided

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