Summarize examples of how a change in demand for one good can affect demand for a related good?
Answer: Exapmle:When we consider the demand for skis, ski boots are considered a complement. An increase in the price of ski boots will cause people to buy fewer boots. Because skis are useless without boots, the demand for skis will fall at all prices—after all, why buy new skis if you can't afford the ski boots you need?
You might also like to view...
If the government uses its budget surplus to finance additional government purchases or tax cuts, crowding out will
A. not occur. B. occur to a greater degree. C. still occur, but to a lesser degree. D. occur more rapidly.
A firm that exists as a separate legal being is
a. a sole proprietorship b. a corporation c. a partnership d. likely to be a small, family-run business e. still dependent on its owners in many ways
What is the effect on the rate of inflation of the Federal Reserve printing large quantities of currency?
A. increases the rate. B. has no effect on rate. C. decreases the rate.
The marginal revenue curve of a monopolistically competitive firm is
A) downward sloping and above the demand curve. B) downward sloping and below the demand curve. C) identical to the demand curve as there are many small firms in the market. D) perfectly elastic.