Plastic and steel are substitutes in the production of automobiles. If steel prices go up, all other things unchanged:

A) the equilibrium price of plastic will fall.
B) the demand curve for plastic will shift to the left.
C) the demand curve for plastic will shift to the right.
D) the equilibrium quantity of plastic demanded will increase and the equilibrium price will fall.


Ans: C) the demand curve for plastic will shift to the right.

Economics

You might also like to view...

When goods or services cross international borders

a. countries must ship gold to make payment. b. money must generally move in the opposite direction. c. a future shipment must be made to offset the current purchase. d. payment must be made in another good, using barter.

Economics

What are the main characteristics that make it more likely for a cartel to enforce agreements among participating members?

What will be an ideal response?

Economics

Assuming the Marshall-Lerner condition holds and using the ZZ/Y and NX graphs, illustrate graphically and explain what effect a real depreciation will have on output, exports, imports, and net exports. Clearly label all curves and clearly label the initial and final equilibria

What will be an ideal response?

Economics

Suppose the U.S. GDP growth rate is faster relative to other countries' GDP growth rates. U.S. imports will therefore increase faster than U.S. exports, and this will

A) move the economy up along a stationary aggregate demand curve. B) move the economy down along a stationary aggregate demand curve. C) shift the aggregate demand curve to the left. D) shift the aggregate demand curve to the right.

Economics