If two goods are substitutes in consumption, a(n):
a. decrease in the price of one product will cause an increase in the demand for the other product.
b. decrease in the price of one product will cause a decrease in the demand for the other product.
c. increase in the price of one product will cause an increase in the supply of the other product.
d. increase in the price of one product will cause a decrease in the supply of the other product.
e. increase in the price of one product will cause a decrease in the demand for the other product.
b
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When the price of a pizza decreases from $12 to $10, it is definitely the case that the
A) income effect means people buy less pizza. B) substitution effect means people buy more pizza. C) quantity demanded of pizza will not change. D) None of the above answers is correct.
One of the reasons that a firm can be ________ efficient than a market is that the firm ________
A) more; does not have any economies of scale B) more; lowers transactions costs C) less; has economies of scope D) less; produces lower profits
According to research, after the Tax Reform Act of 1986, the effective marginal tax rate on equipment has
A. decreased substantially. B. stayed basically the same. C. increased. D. decreased slightly.
Economic magnitudes measured at the prices actually paid are referred to as ________ magnitudes
A) "real" B) "actual" C) "nominal" D) "unadjusted" E) "gross"