All other factors held constant, when McDonald's raises the price of its Quarter Pounder by 50 cents,
A) there is likely to be a decrease in the quantity of Taco Bell's Chalupas demanded, assuming the Quarter Pounder and Chalupas are substitutes.
B) there is likely to be an increase in demand for Taco Bell's Chalupas, assuming the Quarter Pounder and Chalupas are substitutes.
C) there is likely to be a decrease in demand for Taco Bell's Chalupas, assuming the Quarter Pounder and Chalupas are substitutes.
D) there is likely to be an increase in demand for McDonald's Quarter Pounder, assuming the Quarter Pounder and Chalupas are substitutes.
Answer: B
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A) $5 billion; increase B) -$5 billion; increase C) $5 billion; decrease D) -$5 billion; decrease
If grocery stores are able to place their own private label "generic" products wherever they wish, why do some managers deliberately put them on shelves that are hard to get to or difficult to notice?
What will be an ideal response?