If good B is a complement to good A, then a decrease in the price of B
a. increases the quantity demanded of A
b. decreases the demand for A
c. increases the demand for A
d. decreases the quantity demanded of A
e. will cause the demand for B to increase
C
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Which of the following is a reason why a firm would not engage in price discrimination?
A) The transactions costs associated with selling the product exceed the price of the product. B) Some firms do not want to violate the law of one price. C) Some firms are not able to segment the market for the products they sell. D) Price discrimination is illegal in some western states and the owners of firms in these states face civil or criminal prosecution if they engage in price discrimination.
Suppose the only leakages are savings and taxes. The tax rate is 0.2 and the multiplier is 1.92. These values imply that the marginal propensity to consume is
A) 0.32. B) 0.60. C) 0.68. D) 0.8.