If milk and cookies are complements and the price of cookies rises, we would expect to see:
A. a decrease in the quantity demanded for milk but no change in demand.
B. an increase in the demand for milk.
C. an increase in the quantity demanded for milk but no change in demand.
D. a decrease in the demand for milk.
Answer: D
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Kelly has decided to start his own business giving sailing lessons. To purchase equipment for the business, Kelly withdrew $1,000 from his savings account, which was earning 3% interest, and borrowed an additional $2,000 from the bank at an interest rate of 7%. What is Kelly's annual opportunity cost of the financial capital that has been invested in the business?
a. $30 b. $140 c. $170 d. $300
Suppose that Jane earns $10,000 in year 1 and $15,000 in year 2, while Jim earns $15,000 in year 1 and $10,000 in year 2. Is there income equality for the two individuals?
A. The annual data indicate equality, but the two-year data indicate inequality B. The annual data indicate inequality, but the two-year data indicate equality C. Both the annual and the two-year data indicate equality D. Both the annual and the two-year data indicate inequality