The price of X falls by ten percent, and the quantity demanded of X increases by ten percent. Meanwhile, the quantity demanded of Y increases by ten percent too. We would conclude that
A) demand for X is elastic, and X and Y are substitutes.
B) demand for X is elastic, and X and Y are complements.
C) demand for X is unit-elastic, and X and Y are complements.
D) demand for X is inelastic, and X and Y are unrelated.
C
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Why would an economist argue that tuition is not the largest cost of attending a state university?
What will be an ideal response?
A country that is a member of the World Trade Organization
A) can use tariffs and quotas to limit trade. B) can establish preferential trading arrangements with other countries. C) is allowed to eliminate all of its tariffs and quotas. D) All of the above.
Alice has spent all of her income on ten different goods, and knows that the marginal utilities per dollar spent on the ten goods are equal. Which of the following statements is correct?
a. She could possibly increase her total utility by redistributing her income among the ten items. b. She has violated the assumption of rationality. c. The law of diminishing marginal utility does not apply to her. d. Any reallocation of income among the ten items will reduce her total utility. e. She must be at a point inside of her budget line.
The demand for a monopoly's output is p = 50 - Q. The monopoly's marginal cost is $4 and the market wage is $2. How many units of labor are demanded by the monopoly?
A) L = 46 B) L = 23 C) L = 0 D) L = 10