Refer to Scenario 3.3 below to answer the question(s) that follow.SCENARIO 3.3: -Mustard and mayonnaise are substitutes. -Mustard and relish are complements. -Mustard is a normal good. -During the summer, about 50% of all mustard was recalled by manufacturers and removed from store shelves.Refer to Scenario 3.3. The mustard recall would have caused
A. an increase in the quantity demanded of relish.
B. a decrease in the demand for relish.
C. a decrease in the quantity demanded of relish.
D. an increase in the demand for relish.
Answer: B
You might also like to view...
Assume a hypothetical case where an industry begins as perfectly competitive and then becomes a monopoly. Which of the following statements regarding economic surplus in each market structure is true?
A) Under perfectly competitive conditions, economic surplus is equal to consumer surplus; there is no producer surplus because firms are price takers. Under monopoly conditions, economic surplus is equal to producer surplus. B) Under perfectly competitive conditions, economic surplus in this industry is maximized. Under monopoly conditions economic surplus is minimized. C) Under perfectly competitive conditions, economic surplus is maximized. Under monopoly conditions economic surplus is less than under perfect competition and there is a deadweight loss. D) Under perfectly competitive conditions, economic surplus in this industry equals consumer surplus plus producer surplus. Under monopoly conditions, some consumer surplus is transferred to producer surplus, but economic surplus is the same as it was under perfectly competitive conditions.
U.S. data suggest that the U.S. economy is located where on the Laffer curve?
A) On the right side, after the peak in tax revenue. B) On the left side, before the peak in tax revenue. C) At the peak in tax revenue. D) The economy was on the right side before the 1980s and on the left side after 1980.
When a country keeps its workers as fully employed as possible, it achieves a higher level of GDP than if many of its workers were idle
a. True b. False Indicate whether the statement is true or false
In which of the following circumstances would a buyer be indifferent about buying a good?
a. The amount of consumer surplus the buyer would experience as a result of buying the good is zero. b. The price of the good is equal to the buyer's willingness to pay for the good. c. The price of the good is equal to the value the buyer places on the good. d. All of the above are correct.