Given that milk and cookies are complements, suppose the price of flour (an ingredient in cookies) rises. What happens in the market for cookies?
A) The equilibrium price and quantity rise.
B) The equilibrium price rises, and the equilibrium quantity falls.
C) The equilibrium price and quantity fall.
D) The equilibrium price falls, and the equilibrium quantity rises.
Ans: B) The equilibrium price rises, and the equilibrium quantity falls.
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Which of the following is a result of a market economy?
A) voluntary exchange B) an equal income distribution C) agreement on equity D) environmental protection
A decline in Tobin's q can be caused by ________
A) a rise in the market value of a firm B) an increase in stock prices C) a decline in stock prices D) a decline in the replacement cost of capital
There are losers and winners from a taxi medallion policy. The losers are consumers and the winners are the people who receive a medallion.
Answer the following statement true (T) or false (F)
A student athlete loves cookies. He receives 200 utils for the first cookie, an additional 160 for the second, an additional 120 for the third, another 80 for the fourth, and another 40 for the fifth. The marginal utility of the fourth cookie is ________
and the total utility of consuming four cookies is ________. A) 40; 80 B) 80; 600 C) 80; 560 D) 40; 40